Allakos Updates Business and Reports Q1 2024 Financials

SAN CARLOS, Calif., May 09, 2024 – Allakos Inc. (Nasdaq: ALLK), a biotechnology firm focused on developing antibody-based treatments for allergic, inflammatory, and proliferative conditions, has provided a business update and disclosed its financial performance for the first quarter ending March 31, 2024.

Recent Developments

Allakos has recently achieved several milestones. The company completed dosing in both the single ascending dose (SAD) and multiple ascending dose (MAD) cohorts of its randomized, double-blind, placebo-controlled Phase 1 trial of intravenous (IV) AK006 in healthy volunteers. Additionally, dosing was finalized in the subcutaneous (SC) AK006 cohort under similar trial conditions. They have also initiated a Phase 1 trial of IV AK006 targeting patients with chronic spontaneous urticaria.

The firm published notable preclinical research in the journal Allergy, indicating that AK006 manages mast cell function through interactions with multiple activating receptors and key signaling pathways. Furthermore, preclinical data about the mechanism of action of AK006 and its role in reducing MRGPRX2-induced skin inflammation were presented at the American Academy of Allergy, Asthma & Immunology (AAAAI) Annual Meeting 2024.

Future Milestones

Allakos has several key milestones on the horizon. For the second quarter of 2024, they plan to report safety, pharmacokinetics (PK), and pharmacodynamics (PD) results from the Phase 1 trial of IV AK006 in healthy volunteers, including data confirming Siglec-6 receptor occupancy in skin biopsy samples. By the third quarter of 2024, they expect to release similar results from the Phase 1 trial of SC AK006 in healthy volunteers. By the end of 2024, the company aims to report topline data from the Phase 1 trial of IV AK006 in patients with chronic spontaneous urticaria (CSU).

Financial Overview

Allakos' financial outlook and restructuring plans outlined in January 2024 remain consistent. The company projects that restructuring activities will extend their cash runway into mid-2026. By the end of 2024, they anticipate total cash, cash equivalents, and investments to range between $81 million and $86 million. The firm also expects to incur approximately $30 million in closeout, severance, and other expenses related to the halted lirentelimab development program, with $12 million of these costs already paid in the first quarter of 2024. The remaining $18 million is expected to be paid out over the second and third quarters of 2024.

Allakos concluded the first quarter of 2024 with $139.3 million in cash, cash equivalents, and investments, marking a decrease of $31.5 million from the start of the quarter. Research and development expenses increased to $34.8 million, up $1.7 million from the same quarter in 2023, due to higher manufacturing costs related to lirentelimab, which has since been halted. General and administrative expenses dropped to $10.9 million from $12.0 million in the first quarter of 2023.

A non-cash impairment charge of $27.3 million was recognized in the first quarter of 2024. This charge was associated with the decline in the company's market capitalization and the discontinuation of the lirentelimab program.

Overall, Allakos reported a net loss of $71.1 million for the first quarter of 2024, compared to a net loss of $42.4 million for the same period in 2023.

About Allakos

Allakos Inc. is a clinical-stage biotechnology company focused on developing treatments that target immunomodulatory receptors on immune effector cells involved in allergic, inflammatory, and proliferative diseases. The company's leading product candidate, AK006, targets Siglec-6, an inhibitory receptor found on mast cells, which play a crucial role in the inflammatory response. In preclinical studies, AK006 has shown potential to deeply inhibit mast cells and reduce their numbers.

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