Avalyn Pharma Inc.: Q1 FY2026 earnings call

What management said about Q1 FY2026, from the documents filed with the SEC on 3 June 2026: press release. The quarter’s numbers.

Key takeaways

Net loss widened to $26.9 million: The company reported a net loss of $26.9 million for the first quarter of 2026, against $17.5 million a year earlier. Loss from operations was $27.9 million, against $18.7 million. Source
MIST enrollment on track for mid-2026: MIST is a 375-patient, 52-week Phase 2b trial of AP01 in progressive pulmonary fibrosis. Enrollment is on track for mid-2026, with topline data in the second half of 2027. Source
Four-year AP01 tolerability data: After four years in the PPF compassionate use cohort, AP01 remained generally well tolerated, with an adverse event profile consistent with the ATLAS Phase 1b trial. Source
R&D rose with trial progression: R&D expenses were $22.9 million, against $15.3 million, primarily driven by the AP01 Phase 2b trial, the ongoing open-label extension and the AP02 Phase 2 trial. Source
Upsized IPO raised $345.0 million gross: The company sold 19,166,667 shares at $18.00 per share, including the full exercise of the underwriters' option for 2,500,000 shares. Net proceeds were approximately $316.1 million. Source
Runway into 2029 projected: Management projects that cash, equivalents and marketable securities, including IPO net proceeds, will fund current operating plans into 2029. Source

“Our recent IPO marks a transformative moment for Avalyn, providing the capital to advance three potentially paradigm-shifting programs in pulmonary fibrosis”
Lyn Baranowski, CEO of Avalyn Pharma

Guidance

Area	Period	Figure
MIST Phase 2b enrollment Source	mid-2026	mid-2026
MIST Phase 2b topline data Source	second half of 2027	second half of 2027
AURA Phase 2 topline data Source	late 2027	late 2027
AP03 Phase 1 initiation Source	by end of 2026	by the end of 2026
Cash runway Source	into 2029	into 2029
Clinical readouts across three programs Source	2027	2027

What changed from last quarter

New: The company completed an upsized IPO in May 2026, selling 19,166,667 shares at $18.00 per share, including the underwriters' full option exercise. Source
New: Adam Golden was appointed General Counsel and Head of Business Development, and Frank Salisbury was appointed Senior Vice President, Commercial. Source

Net loss and operating results

Net loss widened to $26.9 million: The company reported a net loss of $26.9 million for the first quarter of 2026, against $17.5 million a year earlier. Loss from operations was $27.9 million, against $18.7 million. Source
Interest income roughly flat: Interest income was $1.1 million, against $1.2 million a year earlier, partly offsetting operating expenses in the statement of comprehensive loss. Source

Clinical programs and timelines

MIST enrollment on track for mid-2026: MIST is a 375-patient, 52-week Phase 2b trial of AP01 in progressive pulmonary fibrosis. Enrollment is on track for mid-2026, with topline data in the second half of 2027. Source
AURA enrolling AP02 patients: AURA is a Phase 2 trial of AP02 in idiopathic pulmonary fibrosis, designed to enroll 160 patients over 12 weeks. Enrollment is underway after first patient dosing in March 2026. Source
AP03 Phase 1 start planned: AP03, a nebulized combination of pirfenidone and nintedanib, is planned to enter Phase 1 by the end of 2026, as a next-generation fixed-dose combination. Source

“With clinical readouts across each of our three programs expected in 2027, we are executing with focus and discipline as we work to redefine the standard of care for patients living with this devastating disease.”
Lyn Baranowski, CEO of Avalyn Pharma

Open-label extension data

Four-year AP01 tolerability data: After four years in the PPF compassionate use cohort, AP01 remained generally well tolerated, with an adverse event profile consistent with the ATLAS Phase 1b trial. Source
Lung function trend, not an efficacy design: A lung function trend measured by FVC was seen out to 48 months compared with published data. The study was not designed for efficacy. Source
Patient materials for eFlow nebulizer: Two posters at the ATS meeting in May 2026 described revised eFlow Nebulizer instructions for AP01, informed by patient, care partner and physician input. Source

Operating expense drivers

R&D rose with trial progression: R&D expenses were $22.9 million, against $15.3 million, primarily driven by the AP01 Phase 2b trial, the ongoing open-label extension and the AP02 Phase 2 trial. Source
G&A rose on personnel costs: G&A expenses were $5.0 million, against $3.4 million, primarily driven by personnel-related expenses including stock-based compensation. Source

“reinforce our conviction that improved tolerability can unlock the potential for extended duration of treatment and clinical benefit.”
Lyn Baranowski, CEO of Avalyn Pharma

IPO proceeds and cash position

Upsized IPO raised $345.0 million gross: The company sold 19,166,667 shares at $18.00 per share, including the full exercise of the underwriters' option for 2,500,000 shares. Net proceeds were approximately $316.1 million. Source
Runway into 2029 projected: Management projects that cash, equivalents and marketable securities, including IPO net proceeds, will fund current operating plans into 2029. Source
Cash lower than at year-end: Cash, cash equivalents and marketable securities were $123.1 million at March 31, 2026, excluding IPO net proceeds, against $138.4 million at December 31, 2025. Source

Balance sheet movements

Total liabilities increased: Total liabilities were $27.7 million at March 31, 2026, against $15.3 million at December 31, 2025. Total assets were $135.7 million, against $148.9 million. Source
Stockholders' deficit and preferred stock: Total stockholders’ deficit and redeemable convertible preferred stock was $108.0 million, against $133.6 million at December 31, 2025. Source

Strategy and leadership

Inhaled antifibrotic strategy: The company aims to transform the treatment paradigm for pulmonary fibrosis and other rare respiratory diseases through optimized inhaled formulations of established antifibrotic medicines. Source
Two senior appointments: Adam Golden was appointed General Counsel and Head of Business Development, and Frank Salisbury was appointed Senior Vice President, Commercial, to support the next phase of growth. Source

Investor events and communications

Jefferies conference presentation June 4: Management will present a company overview at the Jefferies Global Healthcare Conference in New York City on June 4, 2026. Source
EULAR data presentation June 6: Data from the PPF compassionate use cohort of the ATLAS open-label extension will be presented at the EULAR Conference on June 6, 2026. Source

Coming up, as management said on 3 June 2026

MIST enrollment completion mid-2026: Management expects MIST enrollment to be completed in mid-2026, with topline data in the second half of 2027. Source
EULAR presentation of ATLAS data: The PPF compassionate use cohort data from the ATLAS open-label extension will be presented at EULAR on June 6, 2026. Source
Jefferies investor presentation: Management will present a company overview at the Jefferies Global Healthcare Conference on June 4, 2026. Source
AP03 Phase 1 start by end 2026: The AP03 Phase 1 trial is planned to start by the end of 2026. Source
AURA topline data late 2027: Topline data from the AURA trial of AP02 are anticipated in late 2027. Source

Figures management reported

Figure	Reported
R&D spend Source	$22.9 million (Q1 2026) vs $15.3 million (Q1 2025)
Pipeline: MIST Phase 2b (AP01, PPF) Source	375 patients, 52 weeks; enrollment mid-2026; topline 2H 2027
Pipeline: AURA Phase 2 (AP02, IPF) Source	160 patients, 12 weeks; topline late 2027
Pipeline: AP03 Phase 1 Source	Initiation by end of 2026
Pipeline: AP01 open-label extension (PPF) Source	Data out to 48 months of FVC; four years of AP01 use

Risks management discussed

Operational: The lung function trend in the extension study is not an efficacy endpoint, since the study was not designed for efficacy. Source
Financial: R&D expenses rose as the AP01 Phase 2b, the open-label extension and the AP02 Phase 2 trial progressed, increasing the net loss. Source

Earlier plans management reported on

On track: Management states MIST enrollment is on track to complete in mid-2026. Source
On track: Management states the AP03 Phase 1 trial is on track to initiate by the end of 2026. Source
Not stated: Management projects the cash position, including IPO net proceeds, to fund operating plans into 2029. Source

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

Avalyn Reports First Quarter 2026 Financial Results and Recent Business Highlights

On track to complete enrollment of MIST Phase 2b trial of AP01 in progressive pulmonary fibrosis (PPF) in mid-2026, with newly presented long term open-label extension clinical data that support favorable tolerability profile

Enrollment underway in AURA Phase 2 trial of AP02 in patients with idiopathic pulmonary fibrosis (IPF) with topline data anticipated by the end of 2027

Upsized initial public offering (IPO) gross proceeds of $345.0 million, together with approximately $123.1 million in cash, cash equivalents, and marketable securities as of March 31, 2026, projected to be sufficient to fund operations into 2029

BOSTON, June 3, 2026 -- Avalyn Pharma Inc. (Nasdaq: AVLN), a clinical-stage biopharmaceutical company pioneering inhaled therapies to transform the treatment paradigm of serious, rare respiratory diseases, today announced financial results for the first quarter ended March 31, 2026 and recent business highlights.

“Our recent IPO marks a transformative moment for Avalyn, providing the capital to advance three potentially paradigm-shifting programs in pulmonary fibrosis, a disease where current oral antifibrotics are limited by tolerability challenges that prevent many patients from receiving the full benefit of treatment," said Lyn Baranowski, CEO of Avalyn Pharma. "By delivering inhaled therapies directly to the lungs through nebulization, our programs are designed to address the urgent gap in treatments for these deadly diseases. The combination of anti-fibrotic activity seen in our clinical trials to date, together with the open-label extension data to be presented at EULAR in patients with PPF, reinforce our conviction that improved tolerability can unlock the potential for extended duration of treatment and clinical benefit. With clinical readouts across each of our three programs expected in 2027, we are executing with focus and discipline as we work to redefine the standard of care for patients living with this devastating disease."

Recent Pipeline Progress

AP01 (inhaled pirfenidone)

MIST Phase 2b Trial On-Track to Complete Enrollment Mid-2026, with Multiple Recent Presentations Supporting its Clinical Profile.

MIST is an ongoing Phase 2b randomized, double blind, placebo-controlled trial evaluating two doses of AP01 in patients with PPF. This 375-patient, 52-week trial is designed to assess safety and efficacy of AP01 with a primary endpoint of change in lung function measured by FVC. Enrollment is on-track to be completed mid-2026 with topline data anticipated in the second half of 2027.

On June 6, 2026, the Company will present data from the PPF compassionate use cohort of its ATLAS open-label extension study at the European Alliance for Associations for Rheumatology (EULAR) Conference. Patients in this compassionate use cohort had late stage disease with no other treatment options. Study results indicate that after four years, AP01 remains generally well tolerated in these patients with PPF, with an adverse event profile consistent with that observed in the ATLAS Phase 1b trial. Though this study was not designed for efficacy, a favorable trend in lung function trajectory as measured by FVC was seen out to 48 months compared with published data. These AP01 data, combined with previously reported long-term extension data in patients with IPF, suggest the potential for AP01 to impact disease progression and survival in patients with pulmonary fibrosis.

In May 2026, Avalyn presented two posters at the American Thoracic Society (ATS) Annual Meeting in Orlando, FL, demonstrating its commitment to patients, and both hearing and addressing their concerns. Posters summarized how patient, care partner, and physician input informed improvements in instruction materials for the eFlow® Nebulizer System for AP01, and described the importance of healthcare communication from the patient perspective.

AP02 (inhaled nintedanib)

Enrollment Underway in AURA Phase 2 Trial. In March 2026, Avalyn announced first patient dosing in its AURA trial of AP02. AURA is a Phase 2 randomized, double-blind trial evaluating two doses of AP02 administered twice daily in patients with IPF. The 12-week study is designed to enroll 160 patients to assess safety and efficacy, as measured by FVC, with topline data anticipated in late 2027.

AP03 (inhaled combination of nintedanib and pirfenidone)

Development Underway as Next-Generation Fixed-Dose Combination Therapy: A Phase 1 trial of AP03, a therapeutic approach combining nebulized pirfenidone and nintedanib, is on track to initiate by the end of 2026.

Recent Corporate Highlights

In May 2026, the Company completed an upsized IPO, with the sale of 19,166,667 shares of its common stock, which included the full exercise by the underwriters of their option to purchase an additional 2,500,000 shares of common stock, at $18.00 per share. The Company raised gross proceeds of approximately $345.0 million, before deducting underwriting discounts and commissions and other offering expenses.

Avalyn further strengthened its team to support the next phase of growth with the appointments of Adam Golden as General Counsel and Head of Business Development, and Frank Salisbury as Senior Vice President, Commercial.

Upcoming Conference

Jefferies Global Healthcare Conference, New York City. Management will present a company overview on Thursday, June 4, 2026, at 9:55-10:25 a.m. ET. Access to the webcast can be found here.

Financial Results for First Quarter 2026

Cash Position: Cash, cash equivalents, and marketable securities were $123.1 million as of March 31, 2026. This amount excludes the net proceeds of approximately $316.1 million raised with the company’s IPO in May 2026. The company’s current cash, cash equivalents, and marketable securities, including the net proceeds from its IPO, are projected to be sufficient to fund its current operating plans into 2029.

Research & Development (R&D) Expenses: R&D expenses were $22.9 million for the first quarter of 2026, as compared to $15.3 million for the first quarter of 2025. The increase in R&D expenses was primarily driven by the progression of the AP01 Phase 2b trial and on-going open label extension study, as well the AP02 Phase 2 trial.

General & Administrative (G&A) Expenses: G&A expenses were $5.0 million for the first quarter of 2026, as compared to $3.4 million for the first quarter of 2025. The increase in G&A expenses was primarily driven by personnel-related expenses, including stock-based compensation.

Net loss: Net loss was $26.9 million for the first quarter of 2026, as compared to $17.5 million for the first quarter of 2025.

About Avalyn Pharma Avalyn aims to transform the treatment paradigm for pulmonary fibrosis and other serious, rare respiratory diseases. The company is advancing optimized inhaled formulations of established antifibrotic medicines designed to deliver drug directly to the lungs, enhance local efficacy, and reduce systemic side effects. Avalyn’s AP01 program is an optimized inhaled formulation of pirfenidone currently being evaluated in MIST, a global Phase 2b clinical trial in patients with progressive pulmonary fibrosis (PPF). AP01 has indicated encouraging safety and clinical activity across Phase 1b and multi-year open-label extension trials, with long-term data supporting the potential to preserve lung function while improving tolerability relative to historical oral pirfenidone. Avalyn’s AP02 program is an optimized inhaled formulation of nintedanib currently being evaluated in AURA, a global Phase 2 clinical trial in patients with idiopathic pulmonary fibrosis (IPF). Avalyn is also advancing AP03, an inhaled fixed-dose combination of pirfenidone and nintedanib, designed to deliver multiple antifibrotic mechanisms through a single lung-targeted platform. By leveraging its proprietary drug-device approach and deep expertise in rare respiratory disease development, Avalyn aims to establish a new standard of care in pulmonary fibrosis through inhaled, lung-targeted therapies. For more information, please visit avalynpharma.com and follow the company on LinkedIn.

Forward Looking Statements

Forward-looking statements notice

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements include, without limitation, implied and express statements about Avalyn’s beliefs and expectations regarding: the anticipated enrollment of the MIST Phase 2b trial of AP01 in PPF in mid-2026 and the interpretation and potential implications of clinical data; the ongoing enrollment in the AURA Phase 2 trial of AP02 in patients with IPF and the expected timing of results by the end of 2027; the potential of its product candidates to address significant unmet needs in the treatment of pulmonary fibrosis and related diseases; the possibility that improved tolerability may translate into clinically meaningful benefit; the advancement of its pulmonary fibrosis programs; the planned initiation of a Phase 1 trial of AP03 by the end of 2026; and the potential for any of the Company’s product candidates to establish or contribute to a new standard of care; and Avalyn’s expectations regarding the anticipated timeline of its cash runway and future financial performance.

Forward-looking statements notice

Any forward-looking statements in this press release are based on management’s current expectations and beliefs and are subject to a number of risks, uncertainties and important factors that may cause actual events or results to differ materially from those expressed or implied by any forward-looking statements contained in this press release, including, without limitation, risks associated with: the risk that earlier results may not be indicative of future results, risks related to clinical trial site activation, delays in enrollment generally or enrollment rates that are lower than expected; delays related to assessment of clinical trial results; risks related to unexpected safety or efficacy data observed during clinical studies; risks related to volatile market and economic conditions, risks related to our ability to protect and maintain our intellectual property position or relationships with third-parties, the initiation, timing, progress and results of our current and future research and development programs, preclinical studies and clinical trials; our ability to successfully complete our clinical trials; our ability to advance any product candidates that we may identify and successfully complete any clinical studies, including the manufacture of any such product candidates; the likelihood of our clinical trials demonstrating safety and efficacy of our product candidates; and risks related to needs for additional financing. These and other risks and uncertainties are described in greater detail in the section entitled “Risk Factors” in Avalyn’s current and future filings with the Securities and Exchange Commission, including those described from time to time under the caption “Risk Factors.” In addition, any forward-looking statements represent Avalyn’s views only as of today and should not be relied upon as representing its views as of any subsequent date. Avalyn explicitly disclaims any obligation to update any forward-looking statements subject to any obligations under applicable law. No representations or warranties (expressed or implied) are made about the accuracy of any such forward-looking statements.

Investor Contact: Cassie Saitow, Avalyn Pharma Inc.

Sr. Director, IR and Corporate Communications ir@avalynpharma.com

	Three Months Ended March 31,
	2026	2025
AVALYN PHARMA INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In thousands, except share and per share amounts)
(Unaudited)
OPERATING EXPENSES:
Research and development	$22,889	$15,319
General and administrative	5,020	3,397
Total operating expenses	27,909	18,716
LOSS FROM OPERATIONS	(27,909)	(18,716)
OTHER INCOME (EXPENSE):
Interest income	1,125	1,248
Interest expense	(98)	-
Other expense	13	(35)
Total other income	1,040	1,213
NET LOSS	$(26,869)	$(17,503)

	March 31,	December 31,
	2026	2025
AVALYN PHARMA INC.
CONSOLIDATED BALANCE SHEET DATA
(In thousands)
(Unaudited)
Cash, cash equivalents, and marketable securities	$123,127	$138,359
Total assets	135,663	148,881
Total liabilities	27,687	15,316
Total stockholders’ deficit and redeemable convertible preferred stock	$107,976	$133,565

Contacts
Kat Lippincott, Deerfield Group kat.lippincott@deerfieldgroup.com media@avalynpharma.com