Avacta: early AVA6103 data show promise

Avacta is increasingly defined by the continuing progress with its second-generation pre|CISION tumour-activated Peptide Drug Conjugate (PDC) platform. The investment case centres on pre|CISION’s ability to reduce the efficacy/toxicity trade off seen with many potent oncology therapeutics, thus broadening their clinical utility. The platform employs a small-molecule masking chemistry designed to only specifically release the cytotoxic payloads in the tumour microenvironment (TME) through cleavage by Fibroblast Activation Protein (FAP), an enzyme highly expressed across c 90% of all solid tumours. AVA6103 (FAP-activated, controlled-release exatecan), the lead Gen Two programme, is in Phase Ia dose-escalation studies. Preliminary data corroborate the preclinical translational models, confirming targeted tumour localisation and reduced systemic toxicity compared to both conventional exatecan and AstraZeneca/Daiichi Sankyo’s market-leading antibody-drug conjugate (ADC), Enhertu.  Our updated Avacta rNPV valuation, based on conservative assumptions, is £525m ($671m), equivalent to 111p/share (105p fully diluted).

Avacta is developing a portfolio of peptide-drug conjugates (PDCs) that use its pre|CISION technology to improve the therapeutic index of highly potent yet systemically toxic oncology drugs. Traditional chemotherapies and existing PDCs have historically been constrained by dose-limiting systemic toxicities, often caused by premature payload release in peripheral circulation. pre|CISION addresses this by using a specific peptide sequence – cleavable only by FAPα (fibroblast activation protein-α) – to deliver the payload precisely, preventing cell entry and exposure to healthy tissue until it undergoes enzymatic cleavage in the tumour microenvironment (TME). FAP expression is seen in c 90% of all solid tumours, where it is localised on Cancer-Associated Fibroblasts (CAFs) within the stroma and is virtually absent in healthy mature tissue.

Exhibit 1: Avacta’s development portfolio

Source: Avacta

Beyond the immediate commercial value of the individual pipeline assets (Exhibit 1), the true inflection point for our equity arc relies on proving the widespread utility, and potential scalability, of the pre|CISION platform. A successful clinical demonstration of the Gen Two capping group and linker stability in human plasma would clear the primary conceptual and biological hurdles for the entire technology. This would open up a much broader therapeutic landscape, allowing Avacta to address, for example, established, highly effective drugs that may have historically failed in development solely due to dose-limiting toxicities. By restricting active exposure strictly to the TME, the pre|CISION platform can optimise the therapeutic index of numerous payload classes, creating significant development opportunities across the wider oncology therapy space.

The clinical proof-of-concept for this masking mechanism was established with Avacta’s first-generation programme, faridoxorubicin (AVA6000, FAP-Dox), a doxorubicin payload. In clinical evaluations, AVA6000 demonstrated sufficient peripheral stability and reduction in cardiotoxicity for US regulatory authorities to lift the lifetime maximum dose cap mandated for doxorubicin in subsequent trials. It also delivered durable RECIST responses in salivary gland cancer, reported at ASCO 2026. These provide the initial human validation that the peptide conjugate remains intact in systemic circulation while releasing the active payload within FAP-positive tumour stroma (with a tumour to plasma concentration of 100:1).

AVA6103: the first of the next generation is in Phase I

AVA6103 (FAP-EXd) is the lead Gen Two pre|CISION-enabled PDC. It has an exatecan payload and is intended to address the known limitations of this potent topoisomerase I (Topo I) inhibitor, ie severe dose-limiting toxicities (neutropenia, thrombocytopenia) and short half-life, through modifying its PK profile. It also improves tolerability by reducing systemic exposure to released exatecan. The shift from Gen One (AVA6000) to Gen Two (AVA6103) adds an engineered capping group that is designed to bind in the FAP active site and a self-immolative linker that can be selected from different chemistries to tailor drug delivery from slow release to rapid cleavage. Many different classes of payload can be attached with Gen Two PDCs offering a great versatility in potential applications (Exhibit 2).

Exhibit 2: Gen Two pre|CISION structure brings benefits over Gen One

Source: Avacta

In AVA6103 the capping group increases binding affinity to anchor the intact molecule to stromal fibroblasts. This design clears the parent conjugate (exatecan is the released payload in this case) from plasma within four hours, resulting in a highly favourable tumour-to-plasma ratio, and basically converts the tumour mass into a localised payload reservoir, delivering therapeutic exatecan concentrations for more than five days. The result is extremely targeted delivery to the TME with sustained release of the now active payload directly into the tumour. The goal is for Avacta’s PDCs to achieve the robust efficacy of traditional ADCs but using small molecule chemistry, with added benefits such as improved specificities and/or toxicities, tailored kinetics, and a straightforward bystander effect that addresses both FAP+ve and FAP-ve tumour cells. Additionally, the small molecule science should allow easier, and cheaper, manufacturing.

The validity of this Gen Two architecture is being tested in the clinic. Initial data from the ongoing Phase I FOCUS-01 trial of AVA6103 provides the first human proof of these optimised kinetics, demonstrating that the structural modifications successfully replicate the targeted tissue localisation seen in preclinical models without triggering the severe systemic myelosuppression historically associated with Topo I inhibitors. FOCUS-01 is designed to generate robust data in six selected solid tumours: pancreatic ductal carcinoma (PDAC); gastric cancer (GC/GEC); colorectal cancer (CRC); cervical/vulvar cancers; small cell lung cancer (SCLC); and HR+ breast cancers. These indications have been specifically selected as part of the collaboration with Tempus AI to identify patients with the greatest likelihood of benefitting from targeted exatecan delivery to a FAP sensitive TME.

FOCUS-01: a two-part Phase Ia and Ib study

FOCUS-01 is expected to recruit c 140 patients across seven to nine specialist US centres. It consists of two elements: (1) the Phase Ia dose escalation portion (c 50 patients) with parallel arms dosing every three weeks (Q3W) and every two weeks (Q2W), these should determine MTD (maximum tolerated dose) and guide the RDE (recommended dose for expansion); and (2) the Phase Ib dose expansion which will consist of six cohorts of c 15 patients each, evaluating AVA6103 in these high prevalence cancers (Exhibit 3).

Exhibit 3: AVA6103 Phase I FOCUS-01 trial design

Source: Avacta  Notes BOIN Bayesian optimal interval design, MTD Maximum Tolerated Dose, and RDE Recommended Dose for Expansion

Phase Ia is currently underway, with the first two dose levels (DL1 1.5mg/m² and DL2 3.0mg/m², equivalent to 0.72mg/m² and 1.4mg/m² exatecan payload respectively) successfully completed and DL3 patients assigned. Already the early results are confirming preclinical data showing rapid uptake from the plasma and localisation at the tumour site, with sustained release of active exatecan and the products of the cleaved linkage. Phase Ib is planned to start in early-2027 and will assess indication-specific safety and provide early signs of efficacy, with overall response rate (ORR), progression-free survival (PFS), overall survival (OS), disease control rate (DCR), and duration of response (DoR) as the secondary endpoints.

FOCUS-01: first human data support preclinical results

As of the September 10, 2026 data cutoff, FOCUS-01 has enrolled and dosed 19 patients across the first three escalation cohorts of the Q3W schedule. The baseline demographics represent a heavily pretreated patient population with high tumour burden and advanced metastatic disease:

• Dose Level 1 (1.5mg/m² AVA6103/0.72mg/m² exatecan): Enrolled five patients. The median age was 50 (range 46–75), with a sex split of four males and one female. The Eastern Cooperative Oncology Group (ECOG) performance status was 0 for one patient and 1 for three patients. The median number of prior systemic therapeutic regimens was four (range 1–5), and all four patients (100%) were classified as heavily pretreated. Indications included pancreatic ductal adenocarcinoma (three patients) and gastric cancer (one patient). Two patients remain on ongoing treatment, and two have discontinued. Three patients are evaluable for pharmacokinetics (PK).
• Dose Level 2 (3.0mg/m² AVA6103/1.4mg/m² exatecan): Enrolled seven patients. The median age was 47 (range 44–64), with one male and six females. ECOG status was 0 for two patients and 1 for five patients. The median number of prior regimens was four (range 2–8), and all seven patients (100%) were classified as heavily pretreated. Indications included pancreatic ductal adenocarcinoma (one patient), colorectal cancer (four patients), and cervical cancer (two patients). Six patients remain on ongoing treatment, and one has discontinued. Two patients are currently PK evaluable, with additional sample processing in progress.
• Dose Level 3 (4.5mg/m² AVA6103/2.1mg/m² exatecan): Also enrolled seven patients. Median age was 58 (range 42–68), with two males and five females. ECOG performance status was 0 for one patient and 1 for six patients. The median number of prior systemic therapeutic regimens was five (range 2–8), with four out of seven patients (57%) classified as heavily pretreated. Four patients had received prior irinotecan, with single instances of prior Enhertu and Trodelvy exposure. Indications included pancreatic ductal adenocarcinoma (two patients), colorectal cancer (two patients), and HR+ breast cancer (three patients). All seven patients remain ongoing on active treatment with no discontinuations.

The initial human data from the first cohort offer promising early signs of how the PK of the modified platform is tracking as predicted in preclinical studies. The rapid decline of the intact parent drug in peripheral circulation is consistent with the expected tissue retention profile anticipated by the non-clinical models This clearance is accompanied by a low, sustained appearance of both free exatecan and the companion release peptide in plasma. While the patient numbers are small, this directional pattern indicates that the engineered modification to reduce the platform’s cleavage efficiency is functioning in line with the underlying design concept of containing the systemic payload exposure while ensuring tumour-localised drug activation (Exhibit 4).

Exhibit 4: Phase Ia showing AVA6103 plasma profile replicates preclinical data

Source: Avacta  Notes: Preliminary PK profile for Cohort 1 Patients (Cycle 1, n=3, 1.5mg/m² I/V over 30 mins)

Exhibit 5 summarises the FOCUS-01 safety data to date. Benchmarking against historical data for Topo I ADC Enhertu (trastuzumab deruxtecan) and exatecan is not straightforward due to the inherent variances in patient baselines and trial protocols. Nevertheless, these exploratory findings offer valuable directional insights into AVA6103’s comparative safety and potential therapeutic index.

Exhibit 5: AVA6103 safety comparison with Enhertu and exatecan

Source: Avacta Notes: ¹ Phase I Enhertu safety in Q3W IV schedule as per Doi et al (2017). One case of febrile neutropenia reported as neutropenia; ² Phase I exatecan safety in five-day CVI (continuous venous infusion) schedule as per Rowinsky et al (2000). Safety measured by courses of therapy, reported % of courses per Rowinsky (2000) at the MTD in patients heavily pre-treated (HP), 0.3mg/m² QD. HP defined as >4 courses prior platinum therapy. Nausea and vomiting reported as a single event across doses. All patients treated with AVA6103 considered HP; ³ The safety data are reported as % of patients experiencing treatment-emergent adverse events of any CTCAE grade across AVA6103 (n=19), Enhertu x 3 dose levels (n=9) and exatecan x2 MTD dose levels QDx5 (n=13)

AVA6103: why the therapeutic window is so important

Exatecan is an extremely potent Topo I inhibitor, but its clinical utility as a free small molecule was compromised by its narrow therapeutic index. In early clinical evaluations (Rowinsky) free intravenous exatecan was evaluated in heavily pretreated solid tumour patients matching those enrolled in FOCUS-01. The results established a strict safety ceiling. Even at modest doses for five days, the treatment caused near-universal, severe myelosuppression. Profound Grade 3/4 neutropenia and thrombocytopenia were the primary dose-limiting toxicities, aggravated by a short plasma half-life that required frequent and challenging dosing schedules. For fragile patients who had already sustained bone marrow damage from multiple lines of platinum-based chemotherapy, free exatecan was simply too toxic to tolerate at therapeutic levels.

Daiichi Sankyo, and AstraZeneca, employed an ADC design to combine deruxtecan, an exatecan derivative, with a HER-2 targeting monoclonal antibody to create the market-leading Enhertu (trastuzumab deruxtecan). Enhertu aims to shield healthy tissue from Topo I inhibitor-related systemic toxicity through tethering to a HER2-targeted monoclonal antibody. Despite the greater tumour targeting, plasma instability results in off-target exposure and haematological adverse events remain the most common Grade 3 or higher toxicities seen. Less common (c 10% to 15%), but clinically challenging, is the risk of interstitial lung disease (ILD), which is the cause of the FDA’s Black Box warning.

The off-target effects are compounded by how Enhertu attaches to the HER2 receptor through the slow process of cell-surface antigen binding and receptor-mediated internalisation. This typically creates a 24-hour lag before peak payload accumulation is achieved within the tumour mass, resulting in the Enhertu ADC circulating in plasma for longer. Avacta’s Gen Two approach attempts to address these specific ADC vulnerabilities by shifting the targeting mechanism from the tumour cell surface to the surrounding microenvironment. Since FAP cleavage happens in the TME, the delivery alters the kinetics in two distinct ways:

• Mitigation of plasma instability: Because the parent peptide conjugate clears from peripheral circulation within four hours, its exposure to plasma enzymes is too brief to permit significant premature payload release. Early FOCUS-01 pharmacokinetic data confirm that at equivalent payload doses, the systemic plasma exposure of free exatecan from AVA6103 is 3.38x lower at Dose Level 1 and 3.9x lower at Dose Level 2 than the circulating deruxtecan payload from Enhertu. This reduced peripheral exposure correlates directly with the absence of severe myelosuppression in the heavily pretreated FOCUS-01 cohorts.
• Resolution of the internalisation lag: By targeting FAP-positive stromal fibroblasts rather than cell-surface receptors AVA6103 bypasses the intracellular trafficking bottleneck entirely. The capping group pairs high binding affinity with a reduced enzyme turnover rate. This anchors the intact molecule to the tumour stroma, effectively using the tumour mass as a localised, slow-release reservoir that maintains therapeutic exatecan concentrations for over five days.

These early Phase Ia data provide initial human validation that AVA6103 successfully decouples payload potency from systemic toxicity. By reducing peripheral plasma exposure by three-fold compared to market-leading ADC benchmarks, AVA6103 has demonstrated a clean safety profile across the initial escalation cohorts, avoiding the severe myelosuppression that historically limited free exatecan. We caution that whilst these pharmacokinetic parameters are directionally encouraging, they remain exploratory. Nonetheless, it is reassuring that preclinical findings are being replicated in these early trial results.

AVA6103: why FOCUS-01 results will define pre|CISION

In our view, the critical clinical transition for Avacta will occur in H127, when the Phase Ib expansion cohorts across the six Tempus-selected indications begin to deliver more robust RECIST efficacy data, shifting the equity arc for the Gen Two platform from clinical tolerability to therapeutic utility. Confirming targeted tumour localisation and a reduction in systemic toxicity in multiple solid tumour clinical settings should serve as the foundational validation step required to de-risk the wider pre|CISION platform. A successful proof-of-concept for AVA6103 would not just open up these sizeable clinical indications but should act as a template for other currently suboptimal compounds.

To provide context, we believe the shift from the Gen One chemistry typified by AVA6000 to the Gen Two PDC construct of AVA6103 is a larger and more significant event than from Gen Two to the clinically and commercially highly relevant dual payload constructs of Gen Three. AVA6000 successfully validated the FAP-cleavage mechanism using relatively straightforward chemistry with a doxorubicin backbone, whereas AVA6103 introduces a highly potent and toxic exatecan payload within the targeted and controlled-release conjugate structure. This requires exacting systemic stability in human plasma to prevent off-target toxicities, hence the importance of the Phase Ia PK data and the upcoming Phase Ib results as the defining validation events for the pre|CISION platform.

Once the architecture of the Gen Two construct is validated then the step to the Gen Three dual constructs is, in our view, one of chemical engineering optimisation rather than the conceptual leap between Gen One and Gen Two. If the Gen Two linker and capping groups safely navigate the human circulation and release the payload exclusively in the TME then the fundamental biological hurdle is cleared and, as a result, the multi-payload variations are de-risked materially.

pre|CISION: clinical data will unlock partnerships

Assuming the baseline operational runway will be funded to cover these crucial clinical readouts, we view the maturation of these clinical datasets as the key driver for long-term corporate development. Rather than pursuing premature, low-value arrangements, management continues to maintain active dialogue with multiple global pharmaceutical companies. The emergence of robust human clinical data from AVA6103 (Gen Two) should act as the natural catalysts to evolve these exploratory discussions into meaningful, well-validated commercial partnerships that will likely address Gen Two and Gen Three constructs.

Nonetheless, whilst we view continuing corroborating AVA6103 data as the defining events for the roles, and value, of the pre|CISION platform, other key near-term events include:

• Gen Three candidate selection (H226): payload disclosure and clinical candidate selection for AVA6207 is expected to be announced by end-2026. Advancing its dual-payload technology closer to formal IND-enabling studies is another major step for Avacta. The ability to deliver two distinct therapeutic warheads simultaneously to the TME through a single FAP-mediated cleavage event is clinically attractive and confers clear commercial appeal for pharmaceutical companies with existing, established oncology franchises. Dual-payload constructs could address complex solid tumours that elude single-agent platforms and/or reduce, or even eliminate, resistance through established escape mechanisms.
• Maturing Phase I data for AVA6000 (late 2026/early 2027): The Phase Ib results expected over the coming quarters will help complete the faridoxorubicin clinical package. The FDA agreement of the design of a single pivotal Phase II trial in SGC was reached in mid-2026. Management has made clear its capital allocation priorities, hence AVA6000’s progression into registrational trials is contingent on securing a suitable out-licensing partner to fund this further work.

The coming 12 months, arguably six months, should define the clinical utility of the pre|CISION platform. The AVA6103 Phase Ia data, which we emphasise is still early, does provide directional insights that suggest the preclinical promise may be replicated in the clinic. In our view, it will be the Phase Ib results that should signal whether it can deliver the robust cell-kill of a potent ADC while minimising systemic exposure and employing far simpler, small-molecule manufacturing.

Exhibit 6: Key portfolio events over the next 12 months

Source: Avacta  Notes EMSO=European Society for Medical Oncology, Madrid, 23-27 Oct 2026; FPI=First Patient In; PhIa: Phase Ia; SGC=Salivary Gland Cancer; AACR-Panc= AACR Congress on Pancreatic Cancer, San Diego, 25-28 Sept 2026; TIP=Trial in Progress; TM=triple meeting (AACR-NCI-EORTC=International Conference on Molecular Targets and Cancer Therapeutics), Barcelona, Nov 2026.

Valuation and Financials

We value Avacta using a sum-of-the-parts rNPV model for the disclosed pipeline assets, combined with an indicative placeholder value for the underlying pre|CISION platform chemistries. The individual asset rNPVs are summed and netted against unallocated corporate operating costs and net cash positions. Proof of mechanism data prompts us to revisit assumptions for our pre|CISION platform valuation given potential for pipeline expansion.

Our valuation is now £525m ($671m), equivalent to 111p per share (105p fully diluted for the future share issuance required to settle the outstanding convertible bond liability), vs £475.0m ($608.0m), or 101p per share (94p fully diluted) previously). We deliberately employ conservative assumptions throughout; our discount factor is 12.5% and the £/$ FX rate is 1.28.

Exhibit 7: Avacta sum of the parts valuation

Source: Trinity Delta   Note: assumptions include a 12.5% discount factor; £/$ FX rate of 1.28; * blended valuation comprising an orphan opportunity at 60% and a larger partnering opportunity at 20%

AVA6000 (faridoxorubicin, FAP-Dox): Valued at an rNPV of £76.7m ($98.1m), or 16.3p per share. This incorporates a blended probability of success (PoS) comprising an orphan opportunity at 60% and a larger commercial partnering opportunity at 20%, assuming an 18% royalty tier, peak global sales of $1.5bn, and a projected launch timeline from 2029 onwards.

AVA6103 (FAP-EXd): Valued at an rNPV of £129.8m ($166.2m), or 27.5p per share. Reflecting its current early clinical status, we continued to apply a standard Phase I PoS of 15%. Assumptions include a 20% tier-one royalty structure, a projected market launch from 2031 onwards, and peak global sales of $2.5bn across the broad solid-tumour indications currently under evaluation.

AVA6207 (Gen Three Dual-Payload): Valued at an rNPV of £67.5m ($86.3m), or 14.3p per share, applying a preclinical/IND-enabling PoS of 7.5%. Assumptions include a 20% royalty tier, commercial launch from 2033 onwards, and unadjusted peak sales of $3.5bn, recognizing its potential to mitigate common tumour resistance mechanisms.

pre|CISION Platform: Proof of mechanism data for the new linker and capping group chemistries employed in AVA6103 prompts us to revisit our underlying platform assumptions given the potential for pipeline expansion with multiple payloads. The indicative platform value rises to £240m ($307m), or 50.8p per share, vs £190.0m ($243.2m), or 40.3p per share, previously applying a blended pipeline modifier across unallocated future candidates targeting the wider 90% of FAP-expressing solid tumours.

Our July 2026 Update reviewed Avacta’s FY25 results and June 2026 fundraise. The latter was a strategic equity placement that raised £8.5m net specifically to settle three upcoming quarterly convertible bond (CB) repayments (ie the January 2026 and April 2026 payments that were deferred to October 2027, and the scheduled July 2026 quarterly payment). These three payments have now been satisfied, and the outstanding CB principal is £12m. Our model assumes the CB and associated coupons will be fully extinguished by October 2027 through issuing shares (either directly or indirectly).

Financial forecasts are presented in Exhibit 8. We expect increasing R&D investment as clinical progress is maintained, and larger trials are initiated and progressed for Gen Two and Three assets. Our forecast includes R&D spend of £17.7m in FY26e and reaching £18.6m in FY27e as AVA6103 Phase Ib expansion cohorts initiate. SG&A expenses are projected to grow incrementally from £9.3m in FY26e to £9.5m in FY27e.

Last reported net cash was £16.4m at end-April 2026, providing an operational runway extending into early Q127. To bridge the funding requirement ahead of key data milestones, our model shows an illustrative £25m cash inflow in each of FY26e and FY27e (treated as short-term debt). However, this funding shortfall is likely to be addressed via a combination of licensing proceeds, non-dilutive collaborations, traditional equity raises, or a targeted dual NASDAQ listing.

Exhibit 8: Summary of financials

Source: Avacta, Trinity Delta. Note: Adjusted numbers exclude exceptionals. FY26e and FY27e each include £25m of cash inflows (as illustrative short-term debt) which could come from various sources.

Avacta: clinical data will drive value inflection

Avacta’s investment case centres on its proprietary pre|CISION drug delivery platform, which aims to reduce the efficacy/toxicity trade off seen with many potent therapeutics, thus expanding their utility. pre|CISION is being harnessed to develop novel, highly targeted cancer drugs, and has been validated by lead programme AVA6000 (faridoxorubicin or FAP-Dox), a peptide-drug conjugate of doxorubicin. The next-generation AVA6103 (FAP-EXd), a tailored sustained release exatecan formulation, is in Phase I studies. A dual payload candidate will be selected for study before end-2026. Clinical and pipeline catalysts should provide multiple value inflection points over the next 12-18 months. Increasing industry awareness, coupled with growing investor confidence, has reduced the funding uncertainty that continues to plague many similarly sized biotech players. Our Avacta rNPV valuation, based on conservative assumptions, is £475m ($608m), equivalent to 101p/share (94p fully diluted).

Avacta is a pure play oncology biopharma company with management focused on exploiting the full potential of its proprietary pipeline and pre|CISION platform. It aims to develop a broad portfolio of peptide-drug conjugates (PDCs) that use its pre|CISION technology to improve the therapeutic index of many highly potent yet systemically toxic oncology drugs. The platform allows these compounds to remain inert until they are specifically activated by FAP-cleavage in the tumour microenvironment (TME). FAPα (fibroblast activation protein-α) is a tumour-associated enzyme expressed by cancer-associated fibroblasts (CAFs). This precise activation minimises systemic exposure and allows optimisation of dosing (higher or more frequent dosing) and/or broadens the therapeutic window for these otherwise highly potent and effective drugs.

Exhibit 1: pre|CISION broadens the therapeutic window of potent oncology drugs constrained by toxicities

Source: Avacta

The pre|CISION platform, described in detail in our November 2024 Outlook, has seen material enhancement in recent years as its potential has become better understood. It is very flexible and can be used to create highly tailored therapeutic conjugates that have specific characteristics. Briefly, FAP is primarily expressed as a membrane bound enzyme of CAFs in the TME, with only a small amount of FAP needed to cleave the linker and release the active payload either directly into the tumour cell or within the TME (the bystander effect). Around 90% of solid tumours express FAP and would be candidates for pre|CISION targeting (Exhibit 2). A collaboration with Tempus AI, employing its extensive real-world datasets, has helped identify the addressable patient populations and refine the selection of the most clinically promising and commercially relevant indications.

Exhibit 2: Market opportunity with Avacta’s pre|CISION drug candidates

Source: Avacta

The pipeline (Exhibit 3) includes the lead programme faridoxorubicin (AVA6000, FAP-Dox) a doxorubicin PDC; AVA6103 (FAP-EXd), a Phase I sustained release PDC targeting topoisomerase I (Topo I) via an exatecan payload; and AVA6207, the first dual payload PDC, a novel class of engineered biotherapeutics.

Exhibit 3: Avacta’s therapeutic pipeline

Source: Avacta

AVA6000 (FAP-Dox): SGC data package builds

Faridoxorubicin (FAP-Dox) is a relatively straightforward compound and can be viewed as a Gen One pre|CISION chemistry. FAP-Dox has played a pivotal role in that it has not only provided a better understanding of FAP biology but also effectively demonstrated the proof of concept for the pre|CISION technology. The clinical data so far (January 2026 Outlook) have shown targeted doxorubicin release in the TME (tumour to plasma concentration of 100:1), improved safety and tolerability vs standard doxorubicin with no dose-limiting toxicities nor cardiac safety signals (0% vs 6%-20% expected), and preliminary signs of efficacy in high grade soft tissue sarcomas (STS) and salivary gland cancer (SGC).

The SGC indication is attractive because of the strength of preliminary efficacy data released to date, most recently at ASCO 2026 (Exhibit 4). Data from the 38 evaluable SGC patients treated in the Phase Ia dose finding and Phase Ib dose expansion cohorts were consistent and showed durable tumour shrinkage, with over 90% disease control rate. Median progression free survival (PFS) data are not yet mature and progression events (eg tumour growth) continue to be collected. For context, median PFS was 3.5 months on conventional chemotherapy. SGC also offers more straightforward clinical development pathway as SGC is a chemo-refractory indication with no defined current treatment regimen.

Exhibit 4: AVA6000 durable tumour shrinkage in SGC

Source: Avacta  Note: data cut off 15/5/2026; all SGC patients (n=38) treated ≥ 250 mg/m² dose level, regardless of schedule; median PFS not yet reached

FDA has agreed to key elements of the design of a single pivotal trial to support potential full regulatory approval in SGC, with a primary endpoint of PFS (Exhibit 5). This study will include both first line and second line patients in the most prevalent subsets of SGC (excluding rarer subtypes) and will evaluate a 310mg/m² faridoxrubicin dose (equivalent to 209mg/m² conventional doxorubicin) in 240 patients. Notably, Phase I data in the defined SGC patient group for the pivotal study (n=32) reveal that confirmed tumour responses have largely occurred in this group, with four partial responses and eight minor responses. FDA agreement on the regulatory pathway in SGC could see a first market launch of faridoxorubicin in 1L/2L mSGC in 2029/30 and should also aid ongoing faridoxorubicin partnering discussions; the start of the pivotal trial remains subject to partnering.

Exhibit 5: Faridoxorubicin pivotal Phase II trial design

Source: Avacta

Additionally, ASCO data confirmed a continued clean safety profile across 111 patients dosed with AVA6000, including several patients that reached the protocol-defined lifetime maximum doxorubicin exposure of 550 mg/m². Across the pooled Phase Ia/Ib safety data, there was an absence of severe cardiac toxicity and only minimal changes in left ventricular function (LVEF) (seen in <4% of patients). At the recommended dose for expansion (RDE) of 310mg/m² (n=48) incidence of toxicities were lower than historical rates observed with conventional doxorubicin, despite the RDE being equivalent to c 2.8x the maximum tolerated dose of conventional doxorubicin (75 mg/m²).

PK and exposure-response data that lead to the lifting of the lifetime maximum doxorubicin limit were also presented. Population PK modelling showed that the FAP-mediated release of active doxorubicin from faridoxorubicin results in limited systemic exposure, with higher clearance and larger central volume for distribution, vs conventional doxorubicin which is rapidly systemically distributed and eliminated more slowly (Exhibit 6). While the exposure-response analysis found no meaningful relationship between cardiac toxicity, specifically LVEF changes, and released doxorubicin exposure.

Exhibit 6: Preliminary population PK model vs conventional doxorubicin

Source: Avacta

These data, as well as first data in triple negative breast cancer (TNBC) once this has matured, should strengthen the partnership/licensing package. TNBC is the more significant commercial opportunity given both the unmet need (representing c 15-20% of new breast cancer diagnoses, but 35% of deaths) and widespread use of doxorubicin chemotherapy (particularly in the PD-L1 negative cohort), however it will require larger, and longer, trials. Assuming positive TNBC data and also subject to funding/partnership, a parallel pathway involving c 150 patients in a Phase II study and a further c 750 patients in a pivotal Phase III trial could result in a first 2L mTNBC market approval as early as 2031/32.

In addition to these encouraging efficacy and safety data, translational analyses from the faridoxorubicin Phase Ia/Ib study were recently presented at the BIO International Convention 2026. These analyses confirm two key attributes of the pre|CISION platform: (1) pre|CISION-enabled PDCs are active even when FAP expression is very low; and (2) FAP expression in the TME persists despite tumour response to the PDC. These findings are supported by the underlying principle that FAP is an extracellular enzyme and thus, unlike ADCs, pre|CISION PDCs do not need to be internalised by tumour cells for cleavage to occur.

A proportion of SGC patients were biopsied (n=26) and assessed with standard FAP immunohistochemistry (IHC) and tricolour immunofluorescence studies; two separate statistical analyses indicated no correlation between the FAP expression level and the degree of efficacy (ie tumour response). These analyses, coupled to case series in four SGC patients, indicate robust activity including at very low levels of FAP expression. A smaller cohort of SGC patients had serial FAPI-PET scans to assess changes in FAP expression over time. Preliminary results, from initial imaging data pre- and post-treatment in two patients that had tumour responses to faridoxorubicin, indicate that despite tumour shrinkage expression of FAP is not reduced. Further analysis from the FAPI-PET sub-study is due in Q326.

Confirmation that pre|CISION technology is applicable to and active in very low FAP settings opens a wider opportunity for the platform (including with other payloads) extending into the 90% of solid tumours that express varying levels of FAP. It also means that a biomarker-based companion diagnostic is unnecessary, ultimately reducing cost to payors, and that earlier approaches to optimising pre|CISION targeting in low-FAP tumour types (ie the AVA7100 Affimer-drug conjugate) are redundant and thus have been discontinued allowing resources to be better deployed in developing the Gen Two and Gen Three programmes.

AVA6103 (FAP-EXd): clinical data will be paramount

AVA6103 (FAP-EXd) is the lead second-generation (Gen Two) pre|CISION-enabled PDC. It has an exatecan payload and is intended to address the known limitations of this potent topoisomerase I (Topo I) inhibitor, ie severe dose-limiting toxicities (neutropenia, thrombocytopenia) and short half-life, through modifying its PK profile; and also improving tolerability by reducing systemic exposure to released exatecan. Here the pre|CISION molecule (Exhibit 7) consists of a capping group that is designed to hold the PDC in the FAP active site on the CAFs and a self-immolative linker that modulates the rate of cleavage, finely controling the release of active exatecan in the TME. The result is highly targeted delivery to the TME with sustained release of the now active payload directly into the tumour.

In April 2026 the first patient in the FOCUS-1 Phase I clinical study was treated with FAP-EXd. FOCUS is designed to generate robust data in six selected solid tumours: pancreatic ductal carcinoma (PDAC); gastric cancer (GC/GEC); colorectal cancer (CRC); cervical/vulvar cancers; small cell lung cancer (SCLC); and HR+ breast cancers. These indications have been specifically selected as part of the collaboration with Tempus AI to identify patients with the greatest likelihood of benefitting from the targeted delivery of a Topo I inhibitor to a FAP sensitive TME. This was determined through querying large real-world datasets to identify FAP-positive cancers with co-expression of SLNF11, a predictor for sensitivity and hence optimal responses to Topo I inhibition.

Exhibit 7: AVA6103 is the lead Gen Two programme

Source: Avacta

The FOCUS (FAP-Exd in Oncologic Cancers with Unmet needS) study is expected to recruit c 140 patients across seven to nine specialist US centres (Exhibit 8). Initial results from the Phase Ia dose escalation element (c 50 patients) are expected at end-2026, which should determine the recommended dose for expansion (RDE) and provide the first clinical proof of concept for AVA6103. We view these data as being central to any prospective partnering discussions. The Phase Ib expansion cohorts (c 90 patients), planned to start in early-2027, will assess indication-specific safety and provide early signs of efficacy (with overall response rate, progression-free survival, overall survival, disease control rate, and duration of response as the secondary endpoints).

Exhibit 8: AVA6103 Phase I FOCUS trial design

Source: Avacta  Notes BOIN Bayesian optimal interval design, MTD Maximum Tolerated Dose, and RDE Recommended Dose for Expansion

Impressive preclinical in vitro and in vivo data have been presented at the American Association of Cancer Research (AACR) meetings in 2025 and 2026. These have confirmed several important features of AVA6103:

• Highly specific delivery of exatecan directly into the TME: up to 85-fold higher levels of exatecan in tumour cells vs plasma. By contrast, and as a benchmark, in the clinic and in preclinical models, FAP-Dox showed a four- to six-fold increase in the therapeutic index of doxorubicin;
• Robust and broad-spectrum antitumor activity: AVA6103 showed deeper and more durable responses than achieved with conventional exatecan in multiple patient-derived xenograft models (colorectal, gastric, pancreatic and small cell lung cancers), with biomarker analyses indicating that this resulted from on-target effects of exatecan;
• Sustained release of exatecan: compared with exatecan’s nine-hour half-life, the intact PDC is detectable in the tumour for >5 days, acting as a payload reservoir. The released exatecan is detectable in the tumour within minutes and continues for >5 days at concentrations that kill highly resistant tumour cells. Once released the plasma levels of exatecan are not detectable after 4 hours;
• Demonstration of the bystander effect: co-culture assays show that AVA6103 optimises the bystander effect, with released exatecan able to enter FAP-negative tumour cells following cleavage by FAP-positive cancer associated fibroblasts, resulting in the killing of both FAP-positive CAFs and FAP-negative tumour cells;
• Reassuringly high selectivity for FAP: free exatecan was only seen in the presence of the target FAP enzyme, whereas the closely structurally related DPP and PREP enzyme families showed exatecan levels comparable to no-enzyme controls.

Another preclinical exercise was an innovative AI-driven analysis to assess differences in payload delivery between the pre|CISION PDC platform and a market leading cleavable linker antibody drug conjugate (ADC). The aim was to assess published preclinical data for AstraZeneca/Daiichi Sankyo’s Enhertu (trastuzumab deruxtecan, T-Dxd) against preclinical data for AVA6103 in as comparable a way as possible. Enhertu, a class leading tumour-agnostic HER2-directed ADC used mainly for breast cancer, is based on an exatecan derivative and uses a cathepsin-cleavable linker, while AVA6103 couples sustained release chemistry with the targeted release FAP-cleavable linker. This comparative analysis showed that FAP-EXd had:

• much more rapid drug penetration into the tumour, with Cmax occurring within minutes of dosing compared with T-Dxd Cmax at 24 hours;
• a tumour concentration of 319nmol/L against 74.2nmol/L for T-Dxd, a four-fold improvement of free payload in the tumour; and
• a TSI (Tumour Selectivity Index, ie the ratio of payload in the tumour against that in plasma) that was more than double that of T-Dxd.

Similar preclinical work also showed positive comparisons against Datroway (datopotamab deruxtecan-dlnk, TROP2-Dxd), also AstraZeneca/Daiichi Sankyo. Based on a similar ADC structure, whereas Enhertu targets HER2 (Human Epidermal Growth Factor Receptor 2) like Herceptin’s trastuzumab, Datroway targets TROP2 (Trophoblast Cell-Surface Antigen 2). TROP2 is heavily overexpressed in many solid tumours, including TNBC, urothelial carcinoma, NSCLC, and various digestive neoplasms. The studies again showed a faster delivery and drug release to the tumours, with a better tumour to plasma concentration and longer period within the therapeutic range.

Exhibit 9: Significantly higher tumour selectivity with pre|CISION delivery vs cleavable ADCs

Source: Avacta

Exhibit 10: pre|CISION PDC can address the challenges facing traditional ADCs

Source: Avacta

These preclinical findings quantify the improved selectivity and exposure profile possible with payload delivery by a pre|CISION PDC vs established, commercially successful ADCs. Our January 2026 Outlook details the expected benefits of a pre|CISION PDC over ADCs. In summary, as outlined in Exhibit 10, PDC payload release is highly tumour specific, resulting in much reduced toxicities; their size conveys small molecule levels of tumour penetration, coupled with extracellular payload release; FAP is expressed by 90% of all solid tumours, with the strong bystander effect resulting in efficacy in even low FAP environments; and manufacture is relatively straightforward and inexpensive. This latter point should also mean that small molecule manufacturing of PDCs, and a less complex supply chain, translates into potential health economics benefits over ADCs. We highlight that the manufacture of the monoclonal antibody component the most expensive and time-consuming part of the ADC process, noting Daichi Sankyo’s FY25 $610m impairment charge connected to securing ADC manufacturing capacity.

AVA6207: Gen Three, the first dual payload PDC

AVA6207 will be the first dual payload PDC programme, exploiting new linker chemistry to allow a single PDC molecule to deliver two diverse and/or complementary therapeutic payloads simultaneously to the TME. These payloads are attached to a self-immolative linker that can be tuned to release both, following a single FAP cleavage event, in a finely controlled manner. The kinetics of payload release can be adjusted, providing great flexibility and allowing optimisation of the therapeutic profiles of numerous different payload combinations (Exhibit 11). The clinical appeal is in the blocking of tumour resistance mechanisms that typically arise against single-agent therapies and/or maximising the therapeutic effect through the delivery of two payloads that attack the same tumour cells through different mechanisms.

Exhibit 11: AVA6207 will be the lead Gen Three programme

Source: Avacta

Preclinical studies have examined the Topo I inhibitor (Topo1i) exatecan and DDR (DNA Damage Response) inhibitors as the dual payloads in a number of in vivo and in vitro cancer models. DDR is a complex cellular network that identifies and repairs genetic damage and ATR (Ataxia-telangiectasia and Rad3-related) is a master kinase protein that sits at the very heart of this. The inhibition of these DDR pathways is seen as a promising anti-tumour strategy, with therapies that combine a direct acting therapeutic with DDR inhibition to avoid resistance (DDR is a key resistance mechanism to Topo I inhibition), that could result in improved clinical outcomes. The studies have examined a FAP-Topo1i/ATRi dual payload compound and have shown greater potency than FAP-Topo1i alone (Exhibit 12). Early preclinical data was presented in a poster at AACR-NCI-EORTC Molecular Targets and Cancer Therapeutics 2025.

Exhibit 12: Dual payload compounds elicit a stronger anti-tumour effect than Topo1i alone

Source: Avacta

The levels of dual payload compound release were assessed in the tumour and in plasma and showed high intratumoral concentration of the individual Topo1i and ATRi actives and a low plasma concentration for both. The TSI (Tumour Selectivity Index), a measure of preferential tumour concentration of the payload, showed high selectivity with TSI for Topo1i ranging from 64 to 320 and for ATRi ranging from 325 to 527. In terms of efficacy, both Topo I and ATR levels showed the predicted target engagement was achieved, and durable complete responses were seen (Exhibit 13).

Exhibit 13: Dual payload compounds demonstrate durable complete responses in animal models

Source: Avacta

Similar synergistic improvement in potency could be achieved by combining two distinct anti-cancer mechanisms with established clinical activity. For example, a combination of a microtubule inhibition (MMAE, Monomethyl Auristatin E) and Topo I inhibition (exatecan) has been shown to provide greater and longer lasting anti-tumour activity. These potent Gen Three compounds should retain the favourable toxicity profiles of the Gen Two compounds as payload release is dependent on the presence of FAP-positive CAFs.

The optimisation work is underway, with the first candidate of the Gen Three portfolio expected to be selected late in H226.

Valuation and Financials

We value Avacta using a sum-of-the-parts model, comprising risk-adjusted NPVs (net present value) for the disclosed pipeline assets, and an indicative placeholder valuation for the pre|CISION platform. More details on the rationale for each are available in our January 2026 Outlook. The rNPVs are summed and then netted against unallocated operating costs and net cash (excluding the convertible bond, CB, which we assume will be settled through issuing shares). Our valuation has been updated post FY25 results, rolled forwards in time, and reflects latest management project timeline expectations. We include the June raise in our financial model but given that these funds are earmarked for settling three CB repayments there is a net neutral valuation impact. These changes lift our valuation to £475m (from £471m), equivalent to 101p per share based on the most recent share count (or 94p/share fully diluted for future shares to settle the CB); the key assumptions underpinning our valuation are shown in Exhibit 14.

Exhibit 14: Avacta sum of the parts valuation

Source: Trinity Delta   Note: assumptions include a 12.5% discount factor; £/$ FX rate of 1.28; * blended valuation comprising an orphan opportunity at 60% and a larger partnering opportunity at 20%

Avacta is now a pure therapeutics business, however reported FY25 revenues of £6.3m (FY24: £24.4m) consist of continuing operations of £0.1m (FY24: £0.1m) and discontinued operations of £6.2m (FY24: £24.3m). On a continuing operations basis, R&D expenses were £18.8m (FY24: £14.3m), largely due to the ongoing spend on both AVA6000 and AVA6103. SG&A expenses decreased to £10.0m (FY24: £12.0m) as FY24 included £2.0m in exceptional items (£1.1m for termination payments and settlement agreements; £0.7m legal and professional fees; and £0.2m related to the winding down of the Diagnostics division). FY25 Operating loss was £30.7m (FY24: £32.6m). Accounting for the non-cash items relating to the convertible bond (see below), the FY25 Net Loss from continuing operations was £37.1m (FY24: £29.4m), with discontinued operations being £1.3m (FY24: £23.4m). The two non-core diagnostics businesses, Coris Bioconcept SRL and Launch Diagnostics Holdings, were sold for £2.2 million in September 2025 and for £12.9 million in March 2025 respectively.

In August 2025 the £55m senior, unsecured Convertible Bonds (CB) issued in October 2022 were amended (September 2025 Lighthouse). The difference between the carrying amount of the original debt liability and the fair value of the new debt liability resulted in a gain on derecognition of financial liabilities of £2.0m, which has been recognised in the P&L. The December 2025 debt liability was £13.4m (FY24: £20.5m), with a carrying amount of the derivative liability of £2.8m (FY24: £1.3m). Interest expense was £7.0m (FY24: £9.9m) with a loss of £1.5m (FY24: gain of £13.7m) on the derivative liability. The debt element of the CB was £13.4m (FY24: £20.5m), with a derivative liability of £2.8m (FY24: £1.3m). The principal outstanding was £20.4m at end-2026, with this falling to £19.2m following the conversion of £1.2m of CBs in May 2026.

End-December 2025 cash was £16.9m (end-December 2024: £12.9m); operating cash outflows were £22.6m, £9.9m was received from the Launch Diagnostics and Coris Bioconcept divestments, and net financing activities were an inflow of £16.6m (of which shares issued of £22.5m was offset by CB repayment of £5.1m). In March 2026 an over-subscribed equity issue raised £10m, resulting in the net cash position rising to £16.4m. The cash runway currently extends to Q127.

The recent £9m gross (c £8.5m net) equity raise (June 2026 Lighthouse) will be directed solely towards settling three upcoming CB repayments in cash, specifically the January 2026 and April 2026 payments that were deferred to October 2027 as well as one additional quarterly payment. This strategic raise enabled Avacta to secure equity funding at a more favourable price (70p per share vs the lower reference prices of c 48.75p and c 64.65p for the January and April quarters respectively) and resulting in less dilution than settling these two quarterly repayments in new shares.

As a reminder the amended terms of the CB allow the bond holders to accelerate the repayment of one or both deferred payments, in either cash or shares, from the earliest of: 30 June 2026, or the data readout of the faridoxorubicin Phase Ib study in TNBC. Additionally, from October 2026 bondholders could accelerate a quarterly repayment subject to a maximum of one acceleration per quarter. For the purposes of our model, during FY26 we now assume that both the deferred January and April 2026 and the next scheduled (July 2026) quarterly repayments are settled in cash, with the October 2026 repayment made through share issuance. We continue to assume that the CB and coupon are fully paid by October 2027 ie five years from issuance, and that this will be through issuing shares (either directly or indirectly).

Our updated forecasts following FY25 results include increasing R&D investment as progress is maintained and larger trials are initiated and progressed for Gen Two and Three assets. We forecast R&D spend of £17.7m in FY26e and £18.6m in FY27e. For SG&A we forecast only incremental growth on FY26e (£9.3m) in FY27e (£9.5m).

Our updated forecasts are in line with management commentary of a cash runway into Q127. This is sufficient to reach a number of key milestones, including first data from the Phase I trial for FAP-EXd (AVA6103) by end-2026, and the payload and candidate selection for the first of the Gen Three combination products, also by late H226.  For the purposes of our model, we include £25m of cash inflows in each of FY26 and FY27 (as illustrative short-term debt) which could come from a variety of sources, including potential proceeds from partnership, licensing, or collaboration deals (where we have limited visibility on likely timing or magnitude), and debt and/or equity funding (including a possible NASDAQ listing).

Exhibit 15: Summary of financials

Source: Avacta, Trinity Delta. Note: Adjusted numbers exclude exceptionals. FY26e and FY27e each include £25m of cash inflows (as illustrative short-term debt) which could come from various sources.