Investors

Press Release

Allakos Reports Third Quarter 2019 Financial Results

November 12, 2019 at 4:01 PM EST

REDWOOD CITY, Calif., Nov. 12, 2019 (GLOBE NEWSWIRE) -- Allakos Inc. (the “Company”) (Nasdaq: ALLK), a biotechnology company developing antolimab (AK002) for the treatment of eosinophil and mast cell related diseases, today reported financial results for the third quarter ended September 30, 2019.

Third Quarter 2019 Financial Results

Research and development expenses were $16.1 million in the third quarter of 2019 as compared to $8.7 million in the same period in 2018. The increase in research and development expenses was primarily related to an increase in contract research and development activities in support of the advancement of antolimab (AK002), the Company’s lead antibody, as well as an increase in consulting and personnel-related costs.

General and administrative expenses were $7.5 million in the third quarter of 2019 as compared to $3.3 million in the same period in 2018. The increase in general and administrative expenses was primarily attributable to an increase in personnel-related costs as a result of the Company’s increase in employee headcount. Other period-over-period changes included increases to legal costs, accounting and audit service fees, and public company directors and officers liability insurance premiums.

Allakos reported a net loss of $21.7 million in the third quarter of 2019 as compared to $11.1 million in the same period in 2018, an increase of $10.6 million. Net loss per basic and diluted share was $0.47 for the third quarter of 2019 compared to $0.34 in the same period in 2018.

Allakos ended the third quarter of 2019 with $517.0 million in cash, cash equivalents and marketable securities.

About Allakos

Allakos is a clinical stage biotechnology company developing antibodies that target immunomodulatory receptors present on immune effector cells involved in allergic, inflammatory, and proliferative diseases. The Company’s lead antibody, antolimab (AK002), targets Siglec-8, an inhibitory receptor selectively expressed on human mast cells and eosinophils. Antolimab (AK002) has been shown to inhibit mast cells and deplete eosinophils. Inappropriately activated eosinophils and mast cells have been identified as key drivers in a number of severe diseases affecting the gastrointestinal tract, eyes, skin, lungs and other organs. Antolimab (AK002) has been tested in five clinical studies. In these studies, antolimab (AK002) eliminated blood eosinophils and improved disease symptoms in patients with eosinophilic gastritis and/or eosinophilic gastroenteritis, eosinophilic esophagitis, severe allergic conjunctivitis, chronic urticaria, and indolent systemic mastocytosis. For more information, please visit the Company's website at www.allakos.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, Allakos’ progress and business plans. Such statements are subject to numerous important factors, risks and uncertainties that may cause actual events or results to differ materially from current expectations and beliefs, including but not limited to: Allakos’ early stages of clinical drug development; Allakos’ ability to timely complete clinical trials for, and if approved, commercialize antolimab (AK002), its lead compound; Allakos’ ability to obtain required regulatory approvals for its product candidates; uncertainties related to the enrollment of patients in its clinical trials; Allakos’ ability to demonstrate sufficient safety and efficacy of its product candidates in its clinical trials; uncertainties related to the success of later-stage clinical trials, regardless of the outcomes of preclinical testing and early-stage trials; market acceptance of Allakos’ product candidates; uncertainties related to the projections of the size of patient populations suffering from the diseases Allakos is targeting; Allakos’ ability to advance additional product candidates beyond antolimab (AK002); Allakos’ ability to obtain additional capital to finance its operations; and other important risk factors set forth in Allakos’ most recent Annual Report on Form 10-K filed with the SEC on March 14, 2019, Quarterly Report on Form 10-Q filed with the SEC on November 12, 2019 and future reports to be filed with the SEC. These documents contain and identify important factors that could cause the actual results for Allakos to differ materially from those contained in Allakos’ forward-looking statements. Any forward-looking statements contained in this press release speak only as of the date hereof, and Allakos specifically disclaims any obligation to update any forward-looking statement, except as required by law.


Source: Allakos Inc.

ALLAKOS INC. 
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS 
(in thousands, except per share data)
(unaudited)

  Three Months Ended   Nine Months Ended
  September 30,
    September 30,
 
  2019     2018     2019       2018  
Operating expenses                              
Research and development $ 16,067     $ 8,706     $ 45,276     $ 22,256  
General and administrative   7,517       3,269       19,292       7,952  
Total operating expenses   23,584       11,975       64,568       30,208  
Loss from operations   (23,584 )     (11,975 )     (64,568 )     (30,208 )
Interest income, net   1,887       836       3,888       1,352  
Other expense, net   (35 )     (9 )     (77 )     (154 )
Net loss   (21,732 )     (11,148 )     (60,757 )     (29,010
Unrealized gain (loss) on marketable securities, net of tax   (12 )     (36 )     117       (33 )
Comprehensive loss $ (21,744 )   $ (11,184 )   $ (60,640 )   $ (29,043 )
Net loss per common share:                              
Basic and diluted $ (0.47 )   $ (0.34 )   $ (1.38 )   $ (2.34 )
Weighted-average number of common shares outstanding:                              
Basic and diluted   46,280       32,609       44,025       12,406  


ALLAKOS INC.
CONDENSED BALANCE SHEETS
(in thousands)

    September 30,     December 31,  
    2019     2018  
    (unaudited)          
Assets                
Current assets:                
Cash and cash equivalents   $ 308,805     $ 33,660  
Investments in marketable securities     208,199       145,246  
Prepaid expenses and other current assets     3,071       2,703  
Total current assets     520,075       181,609  
Property and equipment, net     8,427       8,848  
Operating lease right-of-use assets     5,843        
Other long-term assets     802       802  
Total assets   $ 535,147     $ 191,259  
Liabilities and stockholders' equity                
Current liabilities:                
Accounts payable   $ 3,823     $ 2,092  
Accrued expenses and other current liabilities     8,675       3,164  
Total current liabilities     12,498       5,256  
Other long-term liabilities     8,223       2,009  
      Total liabilities     20,721       7,265  
Stockholders' equity:                
Common stock     48       42  
Additional paid-in capital     679,145       288,079  
Accumulated other comprehensive income (loss)     102       (15 )
Accumulated deficit     (164,869 )     (104,112 )
Total stockholders’ equity     514,426       183,994  
Total liabilities and stockholders’ equity   $ 535,147     $ 191,259  
Investor Contact:
Adam Tomasi, President and COO
ir@allakos.com

Media Contact:
Denise Powelldenise@redhousecomms.com

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Source: Allakos Inc.

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