ALMS

Alumis ($ALMS) Major Shareholders' $3.5M 'Bottom Fishing'...2026 Clinical Results to Determine Fate After 75% Plunge

11/25/2025 21:10

Alumis Inc ($ALMS) is a clinical-stage biopharmaceutical company specializing in treatments for autoimmune and neuroinflammatory disorders. Founded in 2021 and listed on NASDAQ in June 2024, the South San Francisco-based company is developing innovative precision immunology therapies centered on next-generation oral TYK2 inhibitors. For investors, this company matters now for a clear reason: despite shares plummeting 75% from their IPO price of $16 to around $4 currently, insiders have been consistently buying shares while pivotal Phase 3 clinical data is expected in early 2026. This represents a classic biotech 'binary event' scenario where clinical results could dramatically impact share price within six months, making it worth considering for risk-tolerant investors. The most notable aspect is the insider trading pattern. In July 2024, immediately after the IPO, major shareholders Foresite Labs and Foresite Capital Management made substantial purchases totaling $40 million at $16 per share. As shares declined, President Martin Babler and Director Alan Colowick made smaller purchases in the $6-7 range in April 2025. More intriguingly, when shares fell further to $4-5 in May 2025, major shareholders resumed buying. Decisively, in November 2025, as shares showed signs of bottoming out and potential recovery, Foresite Labs purchased approximately 580,000 shares over just five days (November 17-21) at prices ranging from $5.59-7.38, investing about $3.5 million total. This suggests that the major shareholder, with the best insight into the company's internal situation, views current price levels as attractive. Alumis's core pipeline asset, ESK-001 (envudeucitinib), is a next-generation oral TYK2 inhibitor targeting moderate-to-severe plaque psoriasis and systemic lupus erythematosus. The drug's Phase 3 ONWARD trial results are expected in Q1 2026, with Phase 2b LUMUS trial results for lupus expected in Q3. The psoriasis and lupus markets each represent tens of billions in annual revenue, with high demand for new treatment options due to limitations of existing therapies. Financial stability is also crucial for investment decisions. Alumis held $377.7 million in cash and marketable securities as of Q3, sufficient to fund operations through 2027. This means even if clinical results are negative, the company won't face immediate bankruptcy risk. Additionally, with a debt-to-equity ratio of just 9.82% and current ratio of 6.01x, the company maintains low leverage and excellent liquidity. However, risk factors are evident. Q3 net loss widened to $110.8 million from $93.1 million year-over-year, with annual losses reaching $245.15 million. As typical for clinical-stage biotech companies, continuous cash burn without revenue is inevitable. Most critically, if clinical results expected in early 2026 fall short of expectations, shares could face devastating declines. Analyst sentiment remains generally positive. The median 12-month price target of $18 suggests approximately 75% upside potential from current levels, with most ratings at 'Buy' or 'Overweight.' Notably, institutional ownership stands at 81%, indicating significant interest from large investment firms. Short-term, the Q1 2026 Phase 3 results announcement will be the most critical inflection point. If trials succeed, shares could surge toward the $18 target level. Conversely, failure could trigger further declines even from current levels. Long-term, A-005 (CNS-penetrant TYK2 inhibitor) trials for multiple sclerosis and lonigutamab results for thyroid eye disease could provide additional growth catalysts. Currently, Alumis represents a classic biotech 'binary bet' scenario. While insider buying provides positive signals, even insiders cannot know clinical outcomes in advance. However, their continued share purchases at current levels suggests confidence in the company's clinical programs and technology platform. Growth-oriented investors capable of tolerating risk might consider the period before 2026 clinical results as an investment opportunity.