1Q26 Reports: Strong Execution Ahead of Abdakibart's EOP2 & Ph3 Initiation 1H27

Research evidence excerpt

1Q26 Reports: Strong Execution Ahead of Abdakibart's EOP2 & Ph3 Initiation 1H27

C O M PA N Y N O T E

M a y 1 3 , 2 0 2 6

Avalo Therapeutics, Inc. (AVTX) Overweight

CONCLUSION PRICE: US$19.94

AVTX reported 1Q26 earnings where they highlighted their recent positive topline data from TARGET: US$60.00

abdakibart's Ph2 LOTUS and preparation work ahead of a Ph3 program which is expected Our $60/share PT is derived from a rNPV

to initiate in 1H27. Accordingly, we are bullish on abdakibart's PoS given the impressive analysis based on abdakibart (AVTX-009) sales

42.2-42.9% absolute HiSCR75 response rates and clean safety profile observed in Ph2 of: 1) $43/sh US hidradenitis suppurativa sales;

LOTUS as well as the diligent preparation AVTX has conducted getting ready for their 2) $11/sh EU5 hidradenitis suppurativa sales;

EOP2 and Ph3 pivotal program. In addition, investors may not realize the enthusiasm and 3) $6/sh cash proforma

growing within the IL-1 MoA space, which we expect sets up multiple indirect catalysts Yasmeen Rahimi, Ph.D.

offering important potential readthrough for abdakibart and may act as clearing events to Sr. Research Analyst, Piper Sandler & Co.

de-risk potential future indication expansion. Further, AVTX recently entered a milestone 646 819-3586, yasmeen.rahimi@psc.com

buyout option and amendment agreement, which we believe was a smart move for capital Emma Nesson

management. Finally, AVTX has ~$487M in pro forma cash. Research Analyst, Piper Sandler & Co.

212 284-9348, emma.nesson@psc.com

• AVTX has been doing their homework to prepare for abdakibart's Ph3 expected Liam Hiester

Research Analyst, Piper Sandler & Co. in 1H27. To start, we point out that AVTX has been diligent in their preparation work 646 656-5259, liam.hiester@psc.com