Avalo Therapeutics Announces Proposed Public Offering of Common Stock and Pre-Funded Warrants

Avalo Therapeutics (NASDAQ: AVTX) commenced an underwritten public offering of common stock and, for certain investors, pre-funded warrants on May 5, 2026.

Rhea-AI Summary

Avalo Therapeutics (NASDAQ: AVTX) commenced an underwritten public offering of common stock and, for certain investors, pre-funded warrants on May 5, 2026. Avalo may grant underwriters a 30-day option to purchase up to an additional 15% of the shares offered.

Proceeds, together with existing cash and investments, are intended to fund clinical development of abdakibart including Phase 3 topline data release, and for working capital and general corporate purposes. Leerink Partners, TD Cowen and BofA Securities are joint bookrunners. The securities are offered under Avalo’s effective Form S-3 shelf registration (No. 333-292614).

Positive

• Provides additional cash to advance Phase 3 development of abdakibart
• Underwritten offering with three joint bookrunners (Leerink, TD Cowen, BofA)

Negative

• Potential shareholder dilution from the public offering and pre-funded warrants
• Underwriters may sell up to 15% more shares, increasing possible dilution

Argus May 6 session

+34.13% close to close Open Argus

Details

News Market Reaction – AVTX

On May 6, the first trading day after this news, AVTX closed 34.13% above the previous close.

Data tracked by StockTitan Argus for the May 6 session.

Market Context

On May 6, the first trading day after this news, the stock closed 34.1% above the previous close. A ...

Analysis

On May 6, the first trading day after this news, the stock closed 34.1% above the previous close. A strong positive reaction aligns with the company’s ability to quickly access its effective shelf and raise capital for abdakibart’s development. However, this proposed underwritten public offering of common stock and pre-funded warrants, with an underwriter option for an additional 15% in shares, represents potential dilution. Past AVTX news often saw price moves that diverged from headline tone, so sustained strength would have depended on deal pricing and perceived balance between dilution and clinical progress.

Key Figures

Underwriter option period: 30 days Underwriter overallotment: 15% Shelf registration number: Form S-3 No. 333-292614 +4 more

Underwriter option period

30 days

Duration of underwriters’ option to buy additional shares/warrant shares

Underwriter overallotment

15%

Additional shares and warrant shares available under the 30-day option

Shelf registration number

Form S-3 No. 333-292614

Registration statement used for the proposed offering

Shelf filing date

January 8, 2026

Date Form S-3 shelf registration was filed with SEC

Shelf effective date

January 20, 2026

Date Form S-3 shelf was declared effective

Shelf capacity

$750,000,000

Amount of securities Avalo may offer under current shelf

Carried-forward shelf

$326,585,963

Previously registered but unsold securities preserved under Rule 415(a)(6)

Historical Context

5 past events · Latest: Apr 28

5 events

1. Apr 28

   Milestone buyout deal

   24h Move

   -10.8%

   Restructured AlmataBio milestone obligations with new buyout option framework.

2. Mar 23

   Earnings and updates

   24h Move

   +0.6%

   Reported 2025 results and cash runway into 2028 with higher R&D spend.

3. Feb 24

   Investor conferences

   24h Move

   +9.5%

   Announced March 2026 healthcare conference participation and webcasts.

4. Feb 18

   Inducement grants

   24h Move

   +6.5%

   Granted stock options to new employees under Nasdaq inducement rule.

5. Feb 04

   Investor conferences

   24h Move

   -10.0%

   Planned February 2026 conference fireside chats and webcast access.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

pre-funded warrants, underwritten public offering, shelf registration statement, form s-3, +2 more

6 terms

pre-funded warrants financial

"offering of shares of its common stock and, in lieu of common stock to certain investors, pre-funded warrants"

Pre-funded warrants are financial instruments that give investors the right to purchase a company's stock at a set price, but with most or all of the purchase price paid upfront. They function like a coupon or gift card for stock, allowing investors to buy shares later at a fixed price, which can be beneficial if they want to avoid future price increases. This makes them important for investors seeking flexibility and certainty in their investment plans.

underwritten public offering financial

"announced that it has commenced an underwritten public offering of shares of its common stock"

An underwritten public offering is when a company sells new shares of its stock to the public with the help of a financial firm, called an underwriter. The underwriter agrees to buy all the shares upfront, reducing the company's risk, and then sells them to investors. This process helps companies raise money quickly and confidently from a wide range of buyers.

shelf registration statement regulatory

"offered pursuant to shelf registration statement on Form S-3 (No. 333-292614)"

A shelf registration statement is a document a company files with regulators that allows it to sell shares or bonds quickly when it’s a good time to raise money. It’s like having a pre-approved plan ready so the company can act fast without going through lengthy paperwork each time they want to sell, making fundraising more flexible.

form s-3 regulatory

"shelf registration statement on Form S-3 (No. 333-292614)"

Form S-3 is a legal document companies use to register their stock sales with the government, making it easier and faster for them to raise money by selling shares to investors. It’s like having a pre-approved shopping list that lets a company quickly sell new shares when they need funds, without going through a lengthy approval process each time.

prospectus supplement regulatory

"This offering is being made only by means of a prospectus supplement and an accompanying prospectus"

A prospectus supplement is an additional document provided alongside a company's main offering details, offering updated or extra information about a specific financial product being sold. It helps investors understand the latest terms, risks, and details of the investment, similar to how an update or revision clarifies or expands on original instructions, ensuring they have current and complete information before making a decision.

u.s. securities and exchange commission regulatory

"that was filed with the U.S. Securities and Exchange Commission (the “SEC”) on January 8, 2026"

The U.S. Securities and Exchange Commission is a government agency responsible for overseeing the stock market and protecting investors. It sets rules to ensure that companies share truthful information and that trading is fair, helping to maintain trust in the financial system. This oversight is important because it helps prevent fraud and ensures that investors can make informed decisions.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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WAYNE, Pa., May 05, 2026 (GLOBE NEWSWIRE) -- Avalo Therapeutics, Inc. (NASDAQ: AVTX) (“Avalo”), a clinical-stage biotechnology company fully dedicated to developing IL-1β based treatments for immune-mediated inflammatory diseases, today announced that it has commenced an underwritten public offering of shares of its common stock and, in lieu of common stock to certain investors, pre-funded warrants to purchase shares of its common stock. All of the shares of common stock and pre-funded warrants to be sold in this offering are being offered by Avalo. In addition, Avalo intends to grant the underwriters a 30-day option to purchase up to an additional fifteen percent (15%) of shares of its common stock (and shares of common stock underlying pre-funded warrants) offered in the public offering on the same terms and conditions. The proposed offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.

Avalo intends to use the net proceeds from the offering, together with its existing cash, cash equivalents and short-term investments, to advance the clinical development of abdakibart, including through its Phase 3 topline data release, and for working capital and other general corporate purposes.

Leerink Partners, TD Cowen and BofA Securities are acting as joint bookrunning managers for the offering.

The securities described above are being offered pursuant to shelf registration statement on Form S-3 (No. 333-292614) that was filed with the U.S. Securities and Exchange Commission (the “SEC”) on January 8, 2026, and was declared effective on January 20, 2026. This offering is being made only by means of a prospectus supplement and an accompanying prospectus that form a part of the registration statement.

A preliminary prospectus supplement related to and describing the terms of the offering will be filed with the SEC and will be available on the SEC’s website located at www.sec.gov. Copies of the preliminary prospectus supplement and an accompanying prospectus related to the offering may also be obtained, when available, from Leerink Partners LLC, Syndicate Department, 53 State Street, 40th Floor, Boston, MA 02109, or by telephone at (800) 808-7525 ext. 6105, or by email at syndicate@leerink.com; TD Securities (USA) LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717 or by email at TDManualrequest@broadridge.com; and BofA Securities, Attention: Prospectus Department, 201 North Tryon Street, NC1-022-02-25 Charlotte, NC 28255- 0001, or by email at dg.prospectus_requests@bofa.com.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of that state or jurisdiction.

About Avalo Therapeutics

Avalo Therapeutics is a clinical stage biotechnology company fully dedicated to developing IL-1β-based treatments for immune-mediated inflammatory diseases. Our lead asset, abdakibart (AVTX-009), is an anti-IL-1β monoclonal antibody (mAb). Positive topline data was recently reported for abdakibart in a  Phase 2 clinical trial in hidradenitis suppurativa (HS). We’re also exploring additional opportunities to make an impact in prevalent indications that have significant remaining unmet needs.

Cautionary Note Regarding Forward-Looking Statements

Statements in this press release may contain “forward-looking statements” that are subject to substantial risks and uncertainties. Forward-looking statements contained in this press release may be identified by the use of words such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “contemplate,” “believe,” “estimate,” “predict,” “potential” or “continue” or the negative of these terms or other similar expressions, and include, but are not limited to, statements regarding the completion and timing of the public offering, the anticipated use of proceeds from the offering and the expectation to grant the underwriters a 30-day option to purchase additional shares. Any forward-looking statements are based on Avalo’s current expectations, forecasts, and assumptions and are subject to a number of risks and uncertainties that could cause actual outcomes and results to differ materially and adversely from those set forth in or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, risks and uncertainties related to market conditions and satisfaction of customary closing conditions related to the proposed public offering. For a discussion of other risks and uncertainties, and other important factors, any of which could cause Avalo’s actual results to differ from those contained in the forward-looking statements in this press release, see the section entitled “Risk Factors” in Avalo’s Annual Report on Form 10-K for the year ended December 31, 2025 and subsequent periodic filings with the SEC, as well as in the preliminary prospectus supplement related to the proposed public offering. Forward-looking statements contained in this press release are based on information available to Avalo as of the date hereof and are made only as of the date of this release. Avalo undertakes no obligation to update such information except as required under applicable law. These forward-looking statements should not be relied upon as representing Avalo’s views as of any date subsequent to the date of this press release. In light of the foregoing, investors are urged not to rely on any forward-looking statement in reaching any conclusion or making any investment decision about any securities of Avalo.

Investor & Media Contact: 

Christopher Sullivan, CFO
Avalo Therapeutics, Inc.
ir@avalotx.com
410-803-6793

Or

Meru Advisors
Lauren Glaser
lglaser@meruadvisors.com

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What is Avalo (AVTX) offering in the May 5, 2026 public offering?

Avalo is offering shares of common stock and pre-funded warrants to certain investors. According to the company, the offering may include a 30-day option for underwriters to purchase up to an additional 15% of the shares offered.

How will Avalo (AVTX) use proceeds from the May 2026 offering?

Proceeds will fund clinical development of abdakibart and corporate needs. According to the company, net proceeds plus existing cash will support Phase 3 topline data activities, working capital, and general corporate purposes.

Who are the bookrunners for Avalo's (AVTX) May 5, 2026 offering?

Leerink Partners, TD Cowen and BofA Securities are joint bookrunning managers. According to the company, these firms are handling the underwritten offering and related syndicate activities.

Will Avalo's (AVTX) offering be dilutive to existing shareholders?

Yes. The offering and pre-funded warrants will increase outstanding shares if exercised or sold. According to the company, underwriters also have a 30-day option to buy up to an additional 15% of offered shares.

Where is the Avalo (AVTX) offering registered and how can investors access the prospectus?

The offering is made under Avalo's Form S-3 shelf registration No. 333-292614. According to the company, a preliminary prospectus supplement will be filed with the SEC and available at www.sec.gov and from the listed bookrunners.