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CUSIP No. 05338F207
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SCHEDULE 13G
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Page 4
of 9 Pages
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1
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NAME OF REPORTING PERSONS
Mr. Ortav Yehudai
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) o
(b) o
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3
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SEC USE ONLY
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4
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CITIZENSHIP OR PLACE OF ORGANIZATION
USA
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NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
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5
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SOLE VOTING POWER
0
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6
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SHARED VOTING POWER
974,639
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7
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SOLE DISPOSITIVE POWER
0
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8
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SHARED DISPOSITIVE POWER
974,639
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9
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
974,639
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10
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CHECK IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN SHARES
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x1
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11
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9)
7.12%2
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12
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TYPE OF REPORTING PERSON
IN/HC
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1
In addition to an aggregate of 474,639 shares of the Issuer's common stock (the "Common Stock") in the aggregate held outright, the
reporting persons hold in the aggregate warrants to purchase 500,000 shares of Common Stock; however, the provisions of such warrants
restrict the exercise of such warrants to the extent that, after giving effect to such exercise, the holder of the warrants and its affiliates,
together with any other person or entities with which such holder would constitute a group, would beneficially own in excess of 9.99%
of the number of shares of Common Stock outstanding immediately after giving effect to such exercise (the "Beneficial Ownership Cap").
As a result, an aggregate of 500,000 shares underlying such warrants are beneficially owned by the reporting persons.
2
Based on a total of 13,184,104 shares outstanding, as reported by the Issuer in its 424B Prospectus filed with the Securities and Exchange
Commission (the "SEC") on February 3, 2023 and 500,000 shares of the Common Stock issuable upon exercise of warrants held by the reporting persons (subject to the Beneficial Ownership
Cap).
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CUSIP
No. 05338F207
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SCHEDULE 13G
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Page 5
of 9 Pages
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| Item 1. | | (a) Name of Issuer |
AVALO THERAPEUTICS, INC.
| Item 1. | | (b) Address of Issuer’s Principal
Executive Offices |
540
Gaither Road, Suite 400
Rockville,
Maryland 20850
| Item 2. | | (a) Names of Persons Filing: |
Great
Point Partners, LLC
Dr.
Jeffrey R. Jay, M.D.
Mr.
Ortav Yehudai
The
Reporting Persons have entered into a Joint Filing Agreement, dated February 13, 2023, a copy of which is filed with this
SCHEDULE 13G as Exhibit A, pursuant to which the Reporting Persons have agreed to file this statement jointly in accordance
with the provisions of Rule 13d-1(k)(1) under the Act.
| Item 2. | | (b) Address
of
Principal
Business Office: |
The address of the principal business office of each of the Reporting Persons is
165 Mason Street, 3rd Floor
Greenwich,
CT 06830
Great Point Partners, LLC is a limited liability company organized under the laws of the State of Delaware. Dr. Jeffrey R. Jay, M.D. is a citizen of the United States. Mr. Ortav Yehudai is a citizen of the United States.
| Item 2. | | (d) Title of Class of Securities |
Common Stock, $0.001 par value per share (the “common stock”)
05338F207
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CUSIP No. 05338F207
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SCHEDULE 13G
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Page 6
of 9 Pages
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Item 3. If
this statement is filed pursuant to §§240.13d-1(b) or 240.13d-2(b) or (c), check whether the person filing is a: |
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(a) |
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Broker or dealer registered under section 15 of the Act (15 U.S.C. 78o); |
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(b) |
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Bank as defined in section 3(a)(6) of the Act (15 U.S.C. 78c); |
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(c) |
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Insurance company as defined in section 3(a)(19) of the Act (15 U.S.C. 78c); |
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(d) |
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Investment company registered under section 8 of the Investment Company Act of 1940 (15 U.S.C. 80a-8); |
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(e) |
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An investment adviser in accordance with §240.13d-1(b)(1)(ii)(E); |
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(f) |
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An employee benefit plan or endowment fund in accordance with §240.13d-1(b)(1)(ii)(F); |
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(g) |
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A parent holding company or control person in accordance with §240.13d-1(b)(1)(ii)(G); |
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(h) |
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A savings associations as defined in Section 3(b) of the Federal Deposit Insurance Act (12 U.S.C. 1813); |
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(i) |
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A church plan that is excluded from the definition of an investment company under section 3(c)(14) of the
Investment Company Act of 1940 (15 U.S.C. 80a-3); |
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(j) |
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A non-U.S. institution in accordance with §240.13d-1(b)(1)(ii)(J); |
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(k) |
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A group, in accordance with §240.13d-1(b)(1)(ii)(K). If filing as a non-U.S. institution in accordance with §240.13d-1(b)(1)(ii)(J),
please specify the type of institution: |
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CUSIP
No. 05338F207
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SCHEDULE 13G
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Page
7 of 9 Pages
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Item
4. Ownership
The information required by Items 4(a) - (c) is set forth in Rows (5) - (11) of the cover pages for the Reporting Persons and is incorporated
herein by reference.
The
percentage set forth in Row (11) of the cover pages for the Reporting Persons are based on a total of 13,184,104 shares outstanding,
as reported by the Issuer in its 424B Prospectus filed with the Securities and Exchange Commission (the "SEC") on February 3, 2023,
and 500,000 shares of the Common Stock issuable upon exercise of warrants held by the reporting persons (subject to the Beneficial
Ownership Cap).
Biomedical
Value Fund, L.P. (“BVF”) is the record holder of 265,798 shares of Common Stock (the “BVF Shares”). Such
shares constitute 1.94% of the shares of Common Stock outstanding, computed in accordance with Rule 13d-3. BVF is the record holder
of warrants to purchase an additional 280,000 shares of Common Stock (the “BVF Warrants”). As a result of the
Beneficial Ownership Cap, 280,000 shares underlying such warrants are exercisable, which constitutes 2.05% of the shares of Common
Stock outstanding, computed in accordance with Rule 13d-3. Each of Dr. Jeffrey R. Jay, M.D. (“Dr. Jay”), as senior managing
member of Great Point, and Mr. Ortav Yehudai (“Mr. Yehudai”), as Managing Director of Great Point, has voting and investment
power with respect to the BVF Shares, and therefore may be deemed to be the beneficial owner of the BVF Shares.
Biomedical Offshore Value Fund, Ltd. (“BOVF”) is the record
holder of 185,110 shares of Common Stock (the “BOVF Shares”). Such shares constitute 1.35% of the shares of Common
Stock outstanding, computed in accordance with Rule 13d-3. BOVF is the record holder of warrants to purchase an additional 195,000
shares of Common Stock (the “BOVF Warrants”). As a result of the Beneficial Ownership Cap, 195,000 shares underlying
such warrants are exercisable, which constitutes 1.43% of the shares of Common Stock outstanding, computed in accordance with Rule
13d-3. Each of Dr. Jeffrey R. Jay, M.D. (“Dr. Jay”), as senior managing
member of Great Point, and Mr. Ortav Yehudai (“Mr. Yehudai”), as Managing Director of Great Point, has voting and investment
power with respect to the BOVF Shares, and therefore may be deemed to be the beneficial owner of the BOVF Shares.
Cheyne
Global Equity Fund (an Open-Ended Fund of Cheyne Select Master Fund ICAV) (“CGEF”) is the record holder of 23,731
shares of Common Stock (the “CGEF Shares”). Such shares constitute .17% of the shares of Common Stock outstanding,
computed in accordance with Rule 13d-3. CGEF is the record holder of warrants to purchase an additional 25,000 shares of Common
Stock (the “CGEF Warrants”). As a result of the Beneficial Ownership Cap, 25,000 shares underlying such warrants are
exercisable, which constitutes .18% of the shares of Common Stock outstanding, computed in accordance with Rule 13d-3. Each of Dr. Jeffrey R. Jay, M.D. (“Dr. Jay”), as senior managing
member of Great Point, and Mr. Ortav Yehudai (“Mr. Yehudai”), as Managing Director of Great Point, has voting and investment
power with respect to the CGEF Shares, and therefore may be deemed to be the beneficial owner of the CGEF Shares.
Great Point is the investment manager with respect to shares issuable from warrants on behalf of BVF, BOVF, and CGEF. The ability of the
Reporting Persons to convert the warrants into common shares is subject to blocker provisions. Specifically, the warrants may only be
converted to the extent that the conversion would not cause any of the Reporting Persons to be the beneficial owners of greater than 9.99%
of the outstanding shares of the issuer’s Common Stock
Notwithstanding
the above, Great Point, Dr. Jay and Mr. Yehudai disclaim beneficial ownership of the BVF Shares, the BOVF Shares, and the CGEF Shares,
except to the extent of their respective pecuniary interests.
Provide the following information regarding the aggregate number and percentage
of the class of securities of the issuer identified in Item 1.
1.
Great Point Partners, LLC
(a)
Amount beneficially owned: 974,639
(b)
Percent of class: 7.12%1
(c)
Number of shares as to which the person has:
(i)
Sole power to vote or direct the vote: 0
(ii)
Shared power to vote or direct the vote: 974,639
(iii)
Sole power to dispose or to direct the disposition of: 0
(iv)
Shared power to dispose or to direct the disposition of: 974,639
2.
Dr. Jeffrey R. Jay, M.D.
(a)
Amount beneficially owned: 974,639
(b)
Percent of class: 7.12%1
(c)
Number of shares as to which the person has:
(i)
Sole power to vote or direct the vote: 0
(ii)
Shared power to vote or direct the vote: 974,639
(iii)
Sole power to dispose or to direct the disposition of: 0
(iv)
Shared power to dispose or to direct the disposition of: 974,639
3.
Mr. Ortav Yehudai
(a)
Amount beneficially owned: 974,639
(b)
Percent of class: 7.12%1
(c)
Number of shares as to which the person has:
(i)
Sole power to vote or direct the vote: 0
(ii)
Shared power to vote or direct the vote: 974,639
(iii)
Sole power to dispose or to direct the disposition of: 0
(iv)
Shared power to dispose or to direct the disposition of: 974,639
1
Based on a total of 13,184,104 shares outstanding, as reported by the Issuer in its 424B Prospectus filed with the Securities and
Exchange Commission (the "SEC") on February 3, 2023 and 500,000 shares of the Common Stock issuable upon exercise of warrants held by
the reporting persons (subject to the Beneficial Ownership Cap).
Item
5. Ownership of Five Percent or Less of a Class
If this statement is being filed to report the fact that as of the date hereof the reporting person has ceased to be the beneficial
owner of more than five percent of the class of securities, check the following [ ].
Item
6. Ownership of More Than Five Percent on Behalf of Another Person
See
Item 4.
Item
7. Identification and Classification of the Subsidiary which Acquired the Security Being Reported on by the Parent
Holding Company or Control Person
Not Applicable.
Item
8. Identification and Classification of Members of the Group
Not Applicable.
Item
9. Notice of Dissolution of Group
Not Applicable.
Item
10. Certification
By signing below I certify that, to the best of my knowledge and belief, the securities referred to above were not acquired
and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities
and were not acquired and are not held in connection with or as a participant in any transaction having that purpose or effect.
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CUSIP No. 05338F207
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SCHEDULE 13G
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Page
8 of 9 Pages
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SIGNATURE
After reasonable inquiry
and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
Dated: February 13, 2023
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Great Point Partners, LLC
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By: |
/s/
Dr. Jeffrey R. Jay, M.D. |
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Dr. Jeffrey R. Jay, M.D., as Senior Managing Member |
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Dr. Jeffrey R. Jay, M.D.
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By: |
/s/
Dr. Jeffrey R. Jay, M.D. |
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Dr. Jeffrey R. Jay, M.D. |
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Mr.
Ortav Yehudai
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By: |
/s/
Mr. Ortav Yehudai |
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Mr. Ortav Yehudai |
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(i) Each of them is individually eligible to use the SCHEDULE 13G to which this Exhibit is attached, and such SCHEDULE 13G is filed on behalf of each of them; and
(ii) Each of them is responsible for the timely filing of such SCHEDULE 13G and any amendments thereto, and for the completeness and accuracy of the information concerning such person contained therein; but none of them is responsible for the completeness or accuracy of the information concerning the other persons making the filing, unless such person knows or has reason to believe that such information is inaccurate.