Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 12, 2024

AVALO THERAPEUTICS, INC.

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of incorporation)


001-37590						45-0705648
(Commission File Number)						(IRS Employer Identification No.)

540 Gaither Road, Suite 400, Rockville, Maryland 20850

(Address of principal executive offices) (Zip Code)

Registrant’s Telephone Number, Including Area Code: (410) 522-8707

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 Par Value	AVTX	Nasdaq Capital Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 8.01 Other Events.

On November 12, 2024, Avalo Therapeutics, Inc. (the “Company”) issued a press release announcing that the Company has received $69.4 million in gross proceeds from the full exercise of the warrants issued in a March 2024 private placement. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

As of November 8, 2024, Avalo has 10,463,633 shares of common stock outstanding and 24,895.92 shares of Series C Preferred Stock outstanding. Each share of Series C Preferred Stock is convertible into 1,000 shares of common stock, subject to beneficial ownership limitations.

On November 12, 2024, the Company posted on its website an updated investor presentation (the “Investor Presentation”). The Investor Presentation will be used from time to time in meetings with investors. A copy of the Investor Presentation is attached hereto as Exhibit 99.2 and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits:


Exhibit No.						Description

99.1						Press Release dated November 1 2 , 2024.

99.2						Investor Presentation.

104						The cover pages of this Current Report on Form 8-K, formatted in Inline XBRL.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.



		AVALO THERAPEUTICS, INC.

Date: November 12, 2024	By:	/s/ Christopher Sullivan
		Christopher Sullivan
		Chief Financial Officer

Exhibit 99.1

Avalo Therapeutics Receives $69.4 Million in Proceeds from the Full Exercise of Private Placement Warrants

•Proceeds from the full exercise of warrants issued in the first quarter of 2024 private placement bring the total gross proceeds from the transaction to $185 million

•Cash runway expected into at least 2027

WAYNE, PA AND ROCKVILLE, MD, November 12, 2024 – Avalo Therapeutics, Inc. (Nasdaq: AVTX), a clinical stage biotechnology company focused on the treatment of immune dysregulation, today announced that it has received $69.4 million in gross proceeds from the full exercise of the warrants issued in a March 2024 private placement.

“We appreciate the outstanding support of our investors by fully exercising their warrants from the private placement earlier this year. While our primary focus remains on the execution of our Phase 2 LOTUS trial in hidradenitis suppurativa, we are excited to expand the AVTX-009 program into additional inflammatory indications,” said Dr. Garry Neil, Chief Executive Officer and Chairman of the Board. “We are hard at work identifying our next indication, the launch and execution of which will benefit from our improved cash position and extended cash runway.”

The warrants were issued as part of the private placement in March 2024 that was led by Commodore Capital and TCGX, with participation from BVF Partners, Deep Track Capital, OrbiMed, Petrichor, and RA Capital Management. 11,967,526 warrants were issued and all have been exercised at an exercise price of $5.796933 per underlying share of common stock, resulting in gross proceeds to Avalo of $69.4 million and the issuance of 781,259 shares of common stock and 11,186.267 shares of series C non-voting convertible preferred stock. As of November 8, 2024, Avalo has 10,463,633 shares of common stock outstanding and 24,895.92 shares of series C preferred stock outstanding. Each share of series C preferred stock is convertible into 1,000 shares of common stock, subject to certain beneficial ownership limitations.

About Avalo Therapeutics

Avalo Therapeutics is a clinical stage biotechnology company focused on the treatment of immune dysregulation. Avalo’s lead asset is AVTX-009, an anti-IL-1β mAb, targeting inflammatory diseases. Avalo also has two additional drug candidates, which include quisovalimab (anti-LIGHT mAb) and AVTX-008 (BTLA agonist fusion protein). For more information about Avalo, please visit www.avalotx.com.

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 the LOTUS Trial

The LOTUS Trial is a randomized, double-blind, placebo-controlled, parallel-group Phase 2 trial with two AVTX-009 dose regimens to evaluate the efficacy and safety of AVTX-009 in approximately 180 adults with moderate to severe hidradenitis suppurativa. Subjects will be randomized (1:1:1) to receive either one of two

dosing regimens of AVTX-009 or placebo during a 16-week treatment phase. The primary efficacy endpoint is the proportion of subjects achieving Hidradenitis Suppurativa Clinical Response (HiSCR75) at Week 16. Secondary objectives include but are not limited to: proportion of patients achieving HiSCR50 and HiSCR90 as well as change from baseline in: International HS Severity Score System (IHS4), draining fistula count, abscess and inflammatory nodule (AN) count and patients achieving at least a 30% reduction on a numerical rating scale in Patient's Global Assessment of Skin Pain (PGA Skin Pain). The number of patients with anti-drug antibodies, safety, and tolerability will be assessed. For additional information this trial (NCT06603077), please visit www.clinicaltrials.gov.

About Hidradenitis Suppurativa

Hidradenitis suppurativa (HS) is a chronic inflammatory skin condition characterized by painful nodules, abscesses, and tunnels that form in areas of the body such as the armpits, groin, and buttocks, severely impacting the quality of life of affected individuals.1 HS is often underdiagnosed or misdiagnosed and therefore estimates of HS vary between 0.2-1.7% of the population worldwide.2-5 The exact cause of HS is not fully understood but is believed to involve a combination of genetic, hormonal, and environmental factors. While advances in treatment have been made, limited treatment options are available. IL-1β plays a crucial role in the inflammatory cascade underlying HS, contributing to tissue damage, inflammation, and disease progression. Given the involvement of IL-1β in the inflammatory process of HS, we believe therapies that target IL-1β offer a potential treatment option for HS.

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 proceeds from the warrant exercise; drug development costs, timing of trials and trial results and other risks, including reliance on investigators and enrollment of patients in clinical trials; reliance on key personnel; regulatory risks; integration of AVTX-009 into our operations; general economic and market risks and uncertainties, including those caused by the war in Ukraine and the Middle East; and those other risks detailed in Avalo’s filings with the Securities and Exchange Commission, available at www.sec.gov. Actual results may differ from those set forth in the forward-looking statements. Except as required by applicable law, Avalo expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Avalo’s expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based.

References

1Patel ZS et al. Curr Pain Headache Rep. 2017;21(12):49.

2Egeberg A, et al. JAMA Dermatol 2016;152:429–34

3Phan K, et al Biomed Dermatol 2020; 4: 2-6

4Jfri, A, et al. JAMA Dermatol. 2021;157(8):924-31

5Nguyen TV, et al. J Eur Acad Dermatol Venereol. 2021;35(1):50-61

For media and investor inquiries:

Christopher Sullivan, CFO

Avalo Therapeutics, Inc.

ir@avalotx.com

410-803-6793

Meru Advisors

Lauren Glaser

lglaser@meruadvisors.com

November 2024 Corporate Presentation Avalo Therapeutics, Inc. (AVTX) EXHIBIT 99.2

Forward-Looking Statements This presentation 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: 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; the intended use of the proceeds from the private placement; reliance on key personnel; regulatory risks; general economic and market risks and uncertainties, including those caused by the war in Ukraine and the Middle East; and those other risks detailed in Avalo’s filings with the Securities and Exchange Commission, available at www.sec.gov. Actual results may differ from those set forth in the forward- looking statements. Except as required by applicable law, Avalo expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Avalo’s expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based. 2

Executive Summary IL, interleukin; IND, investigational new drug application; mAB, monoclonal antibody; MOA, mechanism of action. 3 AVTX-009 (anti-IL-1β mAb) has the potential for a best-in-disease profile in hidradenitis suppurativa (HS) with: • Clinically validated and derisked MOA • Highly potent anti-inflammatory properties with favorable half-life that may allow for improved efficacy and convenient dosing • Favorable safety profile Expected cash runway into at least 2027 AVTX-009 has the potential to treat multiple immune-mediated diseases HS is anticipated to become a $10B market Phase 2 LOTUS trial initiated • Topline Data expected 2026

A proven track record of successful leadership, product development, and commercialization in pharma and biotech Avalo Management Team 175+ Years of Experience in Biotech/Pharma 4 Lisa Hegg, PhD SVP, Program Management, Corporate Infrastructure, Clinical Operations Colleen Matkowski SVP, Global Regulatory Affairs, Quality Assurance Dino C. Miano, PhD SVP, CMC, Technical Operations Chris Sullivan Chief Financial Officer Mittie Doyle, MD Chief Medical Officer Paul Varki Chief Legal Officer Garry A. Neil, MD Chief Executive Officer Chairman of the Board

IL-1β Is Increasingly Recognized as a Master Regulator of Inflammation • IL-1β is a central driver of the inflammatory process1 and activates immune cells that generate proinflammatory cytokines including: – IL-6 – TNF-α – IL-17 • IL-1β is involved in the pathogenesis of many autoimmune and autoinflammatory diseases • Inhibition of IL-1β has been shown to be effective and safe in a variety of inflammatory diseases, including hidradenitis suppurativa1-3 Interleukin-1β Blockade Endothelial Cells Reduces leukocyte adhesion, procoagulant, inflammatory mediator, and pyrogenic prostaglandin production Smooth Muscle Cells Reduces proliferation, inflammatory mediator production Hepatocytes Reduces acute phase reactants: fibrinogen, plasminogen activator inhibitor, CRP Leukocytes IL-6 Dampens neutrophil response at site of inflammation CRP, C-reactive protein; IL, interleukin; TNF, tumor necrosis factor. 1. Dinarello CA. Immunol Rev. 2018;281(1):8-27; 2. Kimball AB, Ackerman L, et al. Presented at: American Academy of Dermatology; March 8-12, 2024; San Diego, CA. Kany S, et al. Int J Mol Sci. 2019;20(23):6008; 3. 5

AVTX-009 Is a Highly Potent and Specific Inhibitor of IL-1β IL, interleukin; IV, intravenous; KD, dissociation constant; Q4W, every 4 weeks; SC, subcutaneous. 1. 2. 3. Chakraborty A, et al. Clin Pharmacokinet. 2012;51(6):e1-e18; 4. Data on file; 5. NCT04983732. Clinicaltrials.gov. Accessed September 5, 2024. https://clinicaltrials.gov/study/NCT04983732; 6. NCT00942188. Clinicaltrials.gov. Accessed September 5, 2024. https://clinicaltrials.gov/study/NCT00942188; 7. NCT00380744. Clinicaltrials.gov. Accessed September 5, 2024. https://clinicaltrials.gov/study/NCT00380744. Bihorel S, et al. AAPS J. 2014;16(5):1009-1017; Sloan-Lancaster J, et al. Diabetes Care. 2013;36(8):2239-2246; 6 • Originally developed by Eli Lilly1,2 • AVTX-009 exhibits superior potency compared to ILARIS® (canakinumab) in vitro – Higher affinity for IL-1β: KD of <3 pM vs. 60 pM canakinumab3 • Stable 150 mg/mL dosage formulation4 – Suitable for subcutaneous and intravenous administration – Initial presentation will be a prefilled syringe, post-approval plan to provide as an autoinjector • Clinical experience: 245 patients studied in phase 1 and phase 2 trials2,4-7 – Significant and rapid lowering of inflammatory biomarkers after a single dose in clinical trials – Excellent tolerability and safety at all doses up to 180 mg weekly • Potency and half-life expected to support Q4W or less frequent dosing AVTX-009 Has Higher Potency than Canakinumab AVTX-009 Has a Strong Pharmacokinetic Profile

AVTX-009 Has High Affinity, High Bioavailability, and Long Half-Life KD, dissociation constant; pM, picomolar. 1. Lacy SE, et al. mAbs. 2015;7(3):605-619. 2. Wang SX, et al. Osteoarthritis Cartilage. 2017;25(12):1952-1961. 3. Bihorel S, et al. AAPS J. 2014;16(5):1009-1017. 7 IL-1β KD (pM) 44 <3 Subcutaneous bioavailability 46% 73% Half-life 10-14 days 19 days Lutikizumab1,2 AVTX-0093 IL-1β IL-1β IL-1α

8 Hidradenitis Suppurativa (HS)

Hidradenitis Suppurativa: a Chronic Disease with a High Unmet Need HS, hidradenitis suppurativa. 1. Ingram JR, et al. J Eur Acad Dermatol Venereol. 2022;36(9):1597-1605. 9 • Hidradenitis suppurativa is a chronic, often debilitating inflammatory skin disease that causes painful lumps, abscesses, and tunnels to form under the skin • Current treatments include: • Antibiotics • Retinoids • Steroids • Cosentyx, Humira 0 10 20 30 40 50 60 70 80 90 Pr op or tio n of p at ie nt s re po rti ng a s ym pt om Mild HS (n = 1179) Moderate HS (n = 523) Severe HS (n = 85) Despite treatment, a large proportion of patients still report significant and life-disrupting symptoms1

HS Causes Severe Pain and High Patient Burden Photo from Cotter C, Walsh S. Skin Health and Disease. 2021;1(1):e7. CC-BY-4.0 License. HS, hidradenitis suppurativa; IL, interleukin. 1. Johnston L, et al. J Cutaneous Med Surg. 2023;27(5):487-492; 2. Ingram JR, et al. J Eur Acad Dermatol Venereol. 2022;36(9):1597-1605; 3. Kimball AB, et al. Dermatol Ther. 2024;14:83-98; 4. Grimstad Ø, et al. J Eur Acad Dermatol Venereol. 2019;33(6):1164-1171; 5. Ren K, Torres R. Brain Res Rev. 2009;60(1):57-64. 10 Hu rle y St ag e 1 (n = 3 1) Hu rle y St ag e 2 (n = 1 88 ) Hu rle y St ag e 3 (n = 3 6) 0 1 2 3 4 5 6 7 8 9 10 Mean NRS pain score M ea n NR S sc or e (p ai n) No pain Mild Moderate Severe Worst Pain Mean Pain Scores by Disease Stage3,4 Nape of neck Breast/chest Buttocks and anus Inner thighs Groin and genitals Abdomen Armpit Areas commonly affected by HS include2: • Pain is a frequently overlooked aspect of HS1,2 • Even patients with “mild” disease report high levels of pain3,4 • This pain interferes with everyday life, sleep, and even movement2 • IL-1β blockade has been shown to reduce pain in multiple inflammatory conditions5

Chronic Inflammation in Hidradenitis Suppurativa Progresses to Tissue Destruction Photos from Mendes-Bastos P, et al. Front Med (Lausanne). 2024;11:1403455; Ovadja ZN, et al. Brit J Dermatol. 2019;181:243-244; Cotter C, Walsh S. Skin Health and Disease. 2021;1(1):e7. CC-BY-4.0 License. 1. Diaz MJ, et al. Curr Iss Mol Bio. 2023;45:4400-4415; 2. Agnese ER, et al. Cureus. 2023;15(11):e49390; 3. de Oliveira ASLE, et al. Biomolecules. 2022;12(10):1371. 11 Hidradenitis suppurativa patients need a potent and targeted anti-inflammatory treatment Disease progression Long-term inflammatory dysregulation Continued extracellular matrix breakdown and remodeling Tunnels • Formed from progressing abscesses • Infection and malodorous discharge • Scarring Abscess Follicular rupture Nodule Formed from follicular blockage

Overall HS prevalence2 HS diagnosed and treated3 Moderate- to-severe HS4 Receiving biologics5 Diagnosed and Treated HS Population is Projected to Grow Substantially into a $9.5B+ Market by 20351 aHS diagnosis and treatment rates and biologic treatment rates are expected to increase over time. CAGR, compound annual growth rate; HCP, healthcare provider; HS, hidradenitis suppurativa; US, United States. 1. HS Market Research 2024. Avalo Therapeutics Data on File; 2. Garg A, et al. Am J Clin Dermatol. 2023;24:977-990; 3. Garg AX, et al. Dermatol Ther. 2022;3:581-594; 4. Ingram JR, et al. J Eur Acad Dermatol Venereol. 2022;36(9):1597-1605; 5. Rinderknecht FB, Naik HB. Int J Womens Dermatol. 2024;10(1):e130. 12 2023 US Base Data 2035 US Projected Potential Market Opportunity Overall prevalence of HS of 3.3M expected to grow to 3.5M Total Addressable Market Number of patients with HS diagnosed and treated will grow significantly from 30% to 45% of the total population, driven by new development and visibility with HCPs and patients Segment Addressable Market Increased recognition of disease leads to 60% growth of identified moderate to severe HS Treated Addressable Market New approvals will lead to more patients being given biologics, increasing from 30% to 40% share of segment, evidenced by the recent quickly growing use of Cosentyx in HS post-approval MARKET DRIVERS 3.3 million 3.5 million (0.5% US population CAGR) 1.0 million 1.6 million (4% HS diagnosis CAGR)a 320,000 513,000 205,000 (40% on biologics in 2030)a 105,000 (33% on biologics in 2023)

IL-1β is Strongly Implicated in the Pathophysiology of HS1 • The inflammatory cascade in HS is triggered by various external stimuli including: – Smoking – Dysbiosis – Mechanical stress • IL-1β is a key driver of the inflammatory cascade that leads to the destruction of the pilosebaceous unit • HS patients exhibit increased IL-1β levels in lesional skin2,3 • Clinical benefit for HS has been observed with anti-IL-1 drugs4 DAMP, damage-associated molecular pattern molecule; DC, dendritic cell; HS, hidradenitis suppurativa; IL, interleukin; R, receptor; PAMP, pathogen-associated molecular pattern molecule. 1. 2. ; 3. 4. Kimball AB, et al. Presented at: American Academy of Dermatology; March 8-12, 2024; San Diego, CA. Calabrese L, et al. Biomolecules. 2024;14(2):175; Vossen ARJV, et al. J Invest Dermatol. 2020;140(7):1463-1466.e2 Kelly G, et al. Br J Dermatol. 2015;173(6):1431-1439; 13

Hidradenitis Suppurativa Patients Often Have Other Comorbidities That Could Impact Treatment 1. Chen WT, Chi CC. JAMA Dermatol. 2019;155(9):1022-1027; 2. 4. Garg A et al. Am J Clin Dermatol. 2023; 24: 977–990; 5. Rinderknecht F-AB, Naik HB. Int J Womens Dermatol. 2024;10(1): e130. Krajewski PK, et al. Int J Dermatol. 2024;63(6):799-805; 3. Abu Rached N, et al. Ann Med. 2024;56(1):2382372; 14 Patients have a ~2-6x increased risk of inflammatory bowel disease1 Patients have a ~1.5x increased risk of cancer (overall) and a ~2.6x increased risk of cutaneous squamous cell carcinoma3 Patients have a ~2x increased risk of myocardial infarction, acute embolism, or deep vein thrombosis2 22-50% of patients are obese and nearly 1 in 3 have diabetes2,3

Warnings and Precautions in Commonly Used Immunologic Drugs HS, hidradenitis suppurativa; IBD, inflammatory bowel disease; IL, interleukin; JAK1, janus kinase 1; MOA, mechanism of action; TNF, tumor necrosis factor. 1. Rinvoq. Package insert. AbbVie Inc.; 2024; 2. Humira. Package insert. AbbVie Inc.; 2024; 3. Cosentyx. Package insert. Novartis Pharmaceuticals Corporation; 2024; 4. Bimzelx. Package insert. UCB Inc.; 2023; 5. Ilaris. Package insert. Novartis Pharmaceuticals Corporation; 2023; 6. Arcalyst. Package insert. Kiniksa Pharmaceuticals (UK), Ltd.; 2021; 7. Kineret. Package insert. Swedish Orphan Biovitrum AB; 2000. 15 JAK1 Inhibitor1 • Serious infection • Opportunistic infection • Risk of malignancy • Thrombosis • Blackbox warning: All-cause mortality Anti-IL-173,4 • Serious infection • IBD exacerbation • Suicidal ideation (Bimzelx) Anti-TNF12 • Serious infection • Opportunistic infection • Risk of malignancy • Thrombosis Anti-IL-1β5/IL-16,7 • Serious infection • Opportunistic infection (isolated cases with Ilaris)

Previous Clinical Trials Validate and Derisk Our MOA HiSCR, hidradenitis suppurativa clinical response; IL, interleukin; JAK1, janus kinase 1; MOA, mechanism of action, TNF, tumor necrosis factor; wk, week; QD, daily; QW, weekly, Q2W, every other week; Q4W, ever 4 weeks. 1. Kirby JS, et al. JAAD. 2024;90(3):P521-529; 2. Acelyrin Press Release. September 11, 2023. Accessed September 10, 2024. https://investors.acelyrin.com/news-releases/news-release-details/acelyrin-inc-announces-top-line- results-placebo-controlled; 3. Kimball AB, et al. Lancet. 2024;403(10443):2504-2519; 4. Kimball AB, Kirby B, et al. Presented at: American Academy of Dermatology; March 8-12, 2024; San Diego, CA; 5. ClinicalTrials.gov identifier: NCT04988308. Accessed September 5, 2024. https://clinicaltrials.gov/study/NCT04988308; 6. Kimball AB, Ackerman L, et al. Presented at: American Academy of Dermatology; March 8-12, 2024; San Diego, CA. 16 0% 20% 40% 60% Pr op or tio n of p at ie nt s ac hi ev in g en dp oi nt HiSCR75 Trial Phase 2 Phase 2B/3 BE HEARD II BE HEARD I Phase 2 Phase 2 Phase 2 interim analysis Phase 2 Phase 2 n/N 52/52 57/175 291/509 289/505 67/234 66/234 35/70 37/153 39/153 Time 12 wk 16 wk 16 wk 16 wk 12 wk 12 wk 16 wk 16 wk 16 wk IL-1α Bermekimab5 1050 mg QW JAK1 Povorcitinib1 75 mg QD IL-17A or IL-17A, F, A/F Izokibep2 Bimekizumab3 Sonelokimab4 120 mg Q2W > Q4W 240 mg Q2W160 mg QW 320 mg Q2W IL-1α/β Lutikizumab6 300 mg Q2W 300 mg QW Comparable efficacy in a sicker population (65%-74% Hurley stage III) that had already failed anti-TNF therapy Failure in phase 2 validates focusing on IL-1β Placebo Investigational drug (placebo adjusted)

Key Secondary Endpoints: • TEAEs • HiSCR50, HiSCR90 • International HS Severity Score System (IHS4) • AN count, draining fistula count • Patient’s Global Assessment of Skin Pain (PGA Skin Pain) (NRS30) • Percentage of subjects with flares • ADA Exploratory Endpoints: • PK • HiSQOL, DLQI, PHQ-9 • Biomarkers: • CRP • IL-6 • Potentially other biomarkers • HS for at least 6 months prior to baseline • Total AN count of ≥5 at baseline • HS lesions must be present in at least 2 distinct anatomic areas • At least one HS lesion that is Hurley stage II or III • Enrollment of patients who have not failed anti-TNF therapy (naive or exposed) will be capped at 40% Primary Endpoint: Percentage of participants achieving HiSCR75 at 16 weeks Key Secondary/Exploratory Endpoints Efficacy and Safety of AVTX-009 Treatment in Participants With Hidradenitis Suppurativa Key Inclusion Criteria Primary Study Endpoint AVTX-009 loading dose 600 mg then 300 mg SC Q4W AVTX-009 loading dose 300 mg then 150 mg SC Q2W Placebo 6-week safety follow-up 0 2 4 8 10 12 14 Pr e- sc re en in g: da y –2 8 to d ay – 7 EOT (week 16) EOS (week 20) Week 6 16 Phase 2 LOTUS Trial in Hidradenitis Suppurativa (AVTX-009-HS-201, NCT06603077) R 1:1:1 N = ~180a aTrial has 80% power to show a HiSCR75 response for each individual arm (based on lutikizumab phase 2 HiSCR75). ADA, antidrug antibody; AN, abscess and inflammatory nodule; CRP, C-reactive protein; DLQI, dermatology life quality index; EOS, end of study; EOT, end of treatment; HiSCR, Hidradenitis Suppurativa Clinical Response; HiSQOL, hidradenitis suppurativa quality of life; HS, hidradenitis suppurativa; NRS30, numerical rating scale 30; PHQ-9, patient health questionnaire-9; PK, pharmacokinetics; Q2W, every 2 weeks; Q4W, every 4 weeks; R, randomize; SC, subcutaneous; TEAE, treatment emergent adverse event; TNF, tumor necrosis factor. 17

Timelines: Looking Forward aProjected; bPending readout from phase 2. IND, investigational new drug application. 18 2026 LOTUS (Ph 2) readouta 2027+ Initiate Ph 2b/3b 2H 2025 Final site activated for LOTUSa 2H 2024 First patient enrolled in phase 2 LOTUS (Ph 2) March 2024 Merger with AlmataBio July 2024 Active IND for AVTX-009

19 Potential Additional Indications

Role of IL-1β in IBD • IL-1β plays a central role in inflammation in IBD1 – IL-1β is a key cytokine produced upon inflammasome activation – Dysregulated inflammasome activation has been implicated in the pathogenesis of Crohn’s disease • IL-1–driven stromal–neutrophil interactions define a subset of patients who do not respond to current therapies2,3 • There is an observed overlap of patients that have IBD and HS4,5 HS, hidradenitis suppurativa; IBD, inflammatory bowel disease. 1. Mao L, et al. Front Immunol. 2018;9:2566; 2. Friedrich M, et al. Nat Med. 2021;27(11):1970-1981; 3. Cader MZ, Kaser A. Nat Med. 2021;27(11):1870-1871; 4. Chen WT, Chi CC. JAMA Dermatol. 2019;155(9):1022-1027; 5. Zhang M, et al. World J Clin Cases. 2021;9(15):3506-3516. 20

Recent IL-1 Trial Initiations in IBD • The goal of IBD therapeutics is remission, yet only a minority of IBD patients obtain remission with current therapies • AbbVie is currently conducting studies to evaluate lutikizumab, a dual variable domain IL-1α/1β antagonist as monotherapy in ulcerative colitis and in combination with Skyrizi in Crohn’s Disease There is an opportunity for greater efficacy for patients with IBD with AVTX-009 as a monotherapy and in combination with anti-IL-23 IBD, inflammatory bowel disease; UC, ulcerative colitis.21 “…we believe lutikizumab has the potential to be used in combinations to provide transformational levels of efficacy in IBD. We plan to evaluate combo approaches with lutikizumab and Skyrizi…in Crohn’s. Our Phase 2 studies in IBD are expected to begin later this year.” ⁻ Roopal Thakkar, MD SVP, Global Therapeutics Chief Medical Officer AbbVie 4Q23 Earnings Call Transcript

22 Executive Summary

Executive Summary IL, interleukin; IND, investigational new drug application; mAB, monoclonal antibody; MOA, mechanism of action. 23 AVTX-009 (anti-IL-1β mAb) has the potential for a best-in-disease profile in hidradenitis suppurativa (HS) with: • Clinically validated and derisked MOA • Highly potent anti-inflammatory properties with favorable half-life that may allow for improved efficacy and convenient dosing • Favorable safety profile Expected cash runway into at least 2027 AVTX-009 has potential to treat multiple immune-mediated diseases HS is anticipated to become a $10B market Phase 2 LOTUS trial initiated • Topline Data expected 2026

24 NASDAQ: AVTX www.avalotx.com

25 Appendix

Avalo Capitalization and Cash Position 1Inclusive of share issuances from warrant exercises in 4Q 2024; 2Does not include 2.6M stock options and restricted stock units outstanding resulting in a fully dilutive share count of 38M26 As of November 8, 2024 Number of shares • Common shares outstanding1 10.5M • Preferred stock1 24.9M • Adjusted common shares outstanding1,2 35.4M • Stock price $13.31 • Adjusted market capitalization $470.6M Common Stock Assuming Conversion of Preferred Stock Adjusted Share Count Adjusted Market Capitalization Cash of approximately $82 million as of September 30, 2024 with subsequent receipt of $69.4M of warrant exercise proceeds in 4Q 2024, provides expected runway into at least 2027

Cover Page Document	Nov. 12, 2024
Cover [Abstract]
Document Type	8-K
Document Period End Date	Nov. 12, 2024
Entity Registrant Name	AVALO THERAPEUTICS, INC.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-37590
Entity Tax Identification Number	45-0705648
Entity Address, Address Line One	540 Gaither Road, Suite 400
Entity Address, City or Town	Rockville
Entity Address, State or Province	MD
Entity Address, Postal Zip Code	20850
City Area Code	410
Local Phone Number	522-8707
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.001 Par Value
Trading Symbol	AVTX
Entity Emerging Growth Company	false
Entity Central Index Key	0001534120
Amendment Flag	false