Item 1. Business
Item 1. Business
Overview
We are a clinical-stage biopharmaceutical company engaged in the discovery and development of innovative, small molecule therapeutics targeting age-related degenerative diseases and disorders of the central nervous system, or CNS, and retina. Currently available therapies for these diseases are limited, with many diseases having no approved therapies or treatments. Our goal is to develop disease-modifying treatments for patients with these degenerative disorders.
Our lead product candidate, zervimesine, also known as CT1812, is an orally delivered, small molecule designed to protect neuronal synapses by preventing the binding of oligomers of pathogenic proteins including β-amyloid, or Aβ and ɑ-synuclein. These and similar protein oligomers have been linked to the progression of degenerative diseases such as Alzheimer’s disease, or AD, and dementia with Lewy bodies, or DLB.
The United States Adopted Name (USAN) Council adopted zervimesine as the USAN for CT1812 in December 2024.
The company’s initial focus has been on the development of zervimesine for the treatment of Alzheimer’s disease. We believe our evidence demonstrates that zervimesine displaces Aβ oligomers from their neuronal receptors. Based on this mechanism, we believe zervimesine has the potential to slow the loss of synapses and cognitive decline observed in AD. The direct healthcare costs to care for patients with AD and other dementias in the United States is estimated to exceed $350 billion. Approximately 7 million people in the United States have been diagnosed with AD, and the World Health Organization estimates that AD affects as many as 35 million people globally.
Enrollment has concluded in the company’s Phase 2 COG0201 (SHINE) study of zervimesine in mild-to-moderate AD. Top-line results were reported in 2024. Enrollment is ongoing in the COG0203 (START) Phase 2 study of zervimesine in patients with Mild Cognitive Impairment (MCI) and early-stage AD. We are conducting the START clinical trial in collaboration with the Alzheimer’s Clinical Trial Consortium, or ACTC, an NIA-funded clinical trials network designed to accelerate studies for therapeutics for AD and related dementias. Both studies are supported by grant awards totaling $110 million from the National Institute of Aging, or NIA, a division of the National Institutes of Health, or NIH.
In addition, company research produced evidence that zervimesine prevents the binding of ɑ-synuclein to neurons, rescuing cellular function that is compromised in DLB. Based on this information, we conducted the Phase 2 COG1201 (SHIMMER) clinical trial in 130 adults with mild-to-moderate DLB, which concluded in 2024. Top-line results were presented in December 2024 and later at the International Lewy Body Dementia Conference (ILBDC) in January 2025. The trial was funded by a grant of approximately $30 million from the NIA.
Our clinical trials have been funded by approximately $171 million in cumulative grants awarded primarily by the NIA. As of October 15, 2024, approximately 477 subjects have received zervimesine in our clinical trials, including people with AD, DLB and dry AMD. Zervimesine has continued to be generally well tolerated and has been granted Fast Track designation by the U.S. Food and Drug Administration, or FDA, for AD.
Recent Developments
In 2024, we reported top-line results from both the Phase 2 COG0201 (SHINE) clinical trial, which evaluated zervimesine in 153 adults with mild-to-moderate (MMSE 18-26) AD, and the Phase 2 COG1201 (SHIMMER) clinical trial in 130 adults with mild-to-moderate DLB.
Top-line SHINE results were presented in July 2024 at the Alzheimer’s Association International Conference (AAIC) and additional data from a biomarker-defined population of AD patients from the SHINE study were presented in October 2024 at the Clinical Trials on Alzheimer’s Disease (CTAD) conference. Top-line results were presented during an investor webinar in December 2024.
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Top-line SHIMMER results were presented at the International Lewy Body Dementia Conference (ILBDC) in January 2025.
We initiated the Phase 2 COG2201 (MAGNIFY) clinical study of zervimesine in 2023 based on evidence that zervimesine may be effective in the treatment of GA secondary to dry AMD. Based on the favorable results from our dementia programs and the need to preserve capital, we made the strategic decision in January 2025 to focus our resources on the development of zervimesine in AD and DLB. As a result, in February 2025 we voluntarily concluded the MAGNIFY clinical study and began investigator site wind-down procedures. The conclusion of the study was not the result of any safety concerns. At the time of the study conclusion, 100 participants had been enrolled in the trial. Results are being compiled by the contract research organization (CRO) following participant completion of final clinic visits. We intend to conduct an analysis of the changes in GA lesion size as well as safety and tolerability, which will be reported in the second quarter of 2025. We continue to believe that zervimesine has the potential to alter the biological processes that contribute to dry AMD.
Our Strategy
Our objectives are to develop and advance our portfolio, beginning with our lead product candidate, zervimesine. We want to leverage our understanding of zeryimesine’s mechanism and its ability to regulate pathways and biological processes. The key elements of our strategy include:
● Advance clinical development of our lead product candidate, zervimesine, in mild-to-moderate AD and earlier stages of the disease . Our lead product candidate, zervimesine, has progressed through Phase 2 clinical trials. Funding of trials to this point has come primarily from the NIA. We are evaluating zervimesine in earlier symptomatic stages of AD and MCI, which is a slight and noticeable measurable decline in cognitive abilities due to AD. Our COG0203 (START) clinical trial in patients with mild dementia associated with early-stage AD has been funded by a grant of approximately $81 million awarded by the NIA.
● Develop product candidates for other CNS and degenerative diseases, including synucleinopathies . We intend to develop and advance other product candidates to treat other conditions, potentially including the synucleinopathies, which include Parkinson’s disease (PD) and DLB. Preclinical data published in February 2021 showed that our candidate’s mechanism may play an integral role in the pathology of DLB and PD, which we believed merited further study. To that end, we conducted a 130-patient Phase 2 COG1201 (SHIMMER) study of zervimesine in patients with DLB, which was funded primarily through the NIA.
● Expand our pipeline through internal development, in-licensing and acquisitions . We intend to leverage our expertise in drug development and business development to evaluate additional product candidates as well as bring forward novel chemical matter using libraries generated with our molecule generation and screening strategies. To achieve this objective, we may supplement our internal development initiatives through selective in-licensing arrangements, as well as investments in strategic collaborations, and partnerships which complement our initiatives.
● Optimize the value of zervimesine and other product candidates in major markets. We currently retain all worldwide rights to zervimesine for all indications. We plan to develop and pursue approval of zervimesine and other future product candidates in major markets. Where appropriate, we may use strategic collaborations or partnerships to accelerate development and maximize the commercial potential of our programs. We and our key opinion leaders believe zervimesine also can be used in combination with other therapeutics and thus may have many partnering opportunities.
● Continue to pursue non-dilutive funding opportunities . The majority of our research and clinical efforts have been funded by approximately $171 million in cumulative grants awarded primarily by the NIA. We intend to continue our work with these research institutions and potentially expand to include pharmaceutical partners, advocacy organizations and others to seek additional non-dilutive funding for our clinical development when possible.
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Zervimesine for the Treatment of Dementias: AD and DLB
Neurodegenerative diseases including AD and DLB are defined by progressive degeneration of nerve cells, or neurons, which often leads to neuronal death, causing dementia, a progressive decline in memory, language, problem-solving and other cognitive functions, results in decreased quality of life and shorter life span. Two of the most common causes of dementia are AD and DLB.
Zervimesine is designed to stop the binding of Aβ and ɑ-synuclein oligomers to neuronal synapses, thereby protecting neurons from the toxic effects of these pathogenic protein species. We believe that zervimesine represents a functionally distinct and promising approach to synaptoprotective therapeutics where neurons remain viable and functional.
Indication
Study Identifier
Clinical Phase
Status
Key Findings
Alzheimer’s Disease (AD)
MCI-early
COG0203 (START)
Phase 2
ongoing
The study is enrolling up to 540 participants with MCI or early AD
mild-moderate
COG0201 (SHINE)
Phase 2 (n=153)
complete
Participants treated with zervimesine experienced a cognitive benefit compared to placebo
mild-moderate
COG0202 (SEQUEL)
Phase 2 (n=16)
complete
Participants treated with zervimesine exhibited improvement across prespecified EEG parameters
mild-moderate
COG0105 (SPARC)
Phase 1 (n=23)
complete
Treatment with zervimesine was assessed using various imaging modalities, including PET imaging and volumetric MRI (vMRI)
mild-moderate
COG0104 (SNAP)
Phase 1 (n=3)
complete
Confirmed preclinical findings showing an increase in Aβ oligomers in CSF, suggesting increased off-rate from receptors
Dementia with Lewy Bodies (DLB)
mild-moderate
COG1201 (SHIMMER)
Phase 2 (n=130)
complete
Participants treated with zervimesine experienced benefits across behavioral, functional, cognitive and motor scales
Alzheimer’s Disease (AD)
Zervimesine was designed to selectively target and displace Aβ oligomers bound to neuronal receptors at synapses, a new and differentiated mechanism of action. In our preclinical studies, zervimesine has demonstrated the potential to protect synapses, facilitate their restoration and improve cognitive performance.
Overview of the Disease
AD is a progressive neurodegenerative disorder characterized by cognitive dysfunction, memory loss, dementia and the impairment of daily living activities, along with numerous behavioral and neuropsychiatric symptoms. In the advanced stages of the disease, an AD patient is unable to recognize faces, use or understand language and displays a lack of awareness for their surroundings. Continued functional decline ultimately results in the patient’s death.
Due to the size of the affected population, we believe that AD is one of the most significant unmet medical needs of our time. Nearly seven million Americans are living with AD and disease prevalence is expected to more than double by 2050. The direct healthcare costs to care for patients with AD and other dementias in the United States is currently estimated to exceed $350 billion and projected to increase to $1 trillion by 2050. Absent the development of meaningful intervention in the course of the disease, the number of people diagnosed with, and dying from, AD is anticipated to escalate appreciably as lifespans lengthen, since prevalence increases significantly with age. The Centers for Disease Control listed AD as the sixth leading cause of death among all adults and the fifth leading cause for those aged 65 or older. The disease is equally devastating worldwide, with the World Health Organization estimating that AD affects as many as 35 million people globally.
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Currently Approved AD Therapeutics
Only two FDA-approved disease-modifying therapeutic options for AD are currently available in the United States: Eisai’s Leqembi (lecanemab), which received complete approval in July 2023; and Eli Lilly’s Kisunla (donanemab), which was approved in July 2024. Both are approved for the treatment of people with MCI or mild Alzheimer’s disease (MMSE between 22 and 30). Biogen’s Aduhelm (aducanumab) was approved in July 2021 but was discontinued in January 2024. Leqembi and Kisunla are monoclonal antibodies administered via infusion designed to slow the progression of cognitive decline by reducing Aβ plaques and protofibrils. They represent approaches that are distinct from our small molecule approach of blocking the binding of Aβ oligomers to synapses.
Other therapies approved for AD are indicated to treat the symptoms of AD: acetylcholinesterase inhibitors, or AChEIs, antipsychotics, glutamatergic modulators and an orexin receptor antagonist. AChEIs are designed to slow the degradation of the neurotransmitter acetylcholine, helping to preserve neuronal communication and function temporarily. Glutamatergic modulators are designed to block sustained, low-level activation of the N-methyl-D-aspartate, or NMDA, receptor without inhibiting the normal function of the receptor in memory and cognition. Namenda (memantine), an NMDA receptor antagonist was approved in the United States in 2003. These therapeutic products do not modify or alter the progression of the underlying disease and provide only modest efficacy in treating the symptoms.
Current Status of AD Therapeutic Approaches
Numerous therapeutic approaches have been evaluated to remedy the causes of AD. Those focused on reducing the aberrant production or removal of intraneuronal neurofibrillary tangles of tau protein have yielded limited clinical benefit. Development initiatives intended to inhibit hyperphosphorylation of the tau protein and related kinase activity, enhance microtubule stability or block tau aggregation have largely been discontinued due to toxicity or a lack of efficacy. Microglial activation and its role in AD-induced neuroinflammation has emerged as another potential target for therapeutic development as has the proper functioning of processes dictating synaptic plasticity, believed to be of central importance to neuronal activity and continued viability. These efforts have also not yielded meaningful clinical advances.
Among the more prevalent and targeted mechanisms implicated in AD is the accumulation of Aβ aggregates in the neuronal synapse where disease progression leads to synaptic dysfunction and dysregulation. The accompanying deterioration in neuronal activity ultimately results in neuronal death. As a result, the reduction in the levels of Aβ aggregates at the synapse has been a prominent objective of a significant number of therapeutic candidates, including active and passive immunotherapies, designed specifically to target Aβ aggregates. As exemplified by Leqembi’s clinical results, we believe that preferentially targeting Aβ protofibrils/oligomers has the potential to prevent synaptotoxicity. Several therapeutics in this class have recently been approved by the FDA, including Aduhelm, Leqembi and Kisunla, which are monoclonal antibodies designed to reduce Aβ plaques and protofibrils, approaches that are distinct from but potentially complementary to our small molecule approach of blocking Aβ oligomer binding.
Emerging Role of Biomarkers in AD
Biomarkers have become increasingly important in the development of treatments for neurodegenerative diseases for a number of reasons, including monitoring drug activity in patients, assessing changes in disease pathology during treatment and identifying responder populations for clinical trials. Given that biomarker-enabled therapeutics have a higher rate of success at gaining product approval, we elected to employ biomarkers in our programs to mitigate clinical development risk. To that end, in addition to a number of cognitive tests, our clinical trials use a variety of biomarkers to measure target and/or pathway engagement and assess changes in disease progression.
For example, in AD, tangles of Aβ and phosphorylated tau (p-tau) build up in the brain and can be visualized through a positron emission tomography, or PET scan. Recently, tests have been developed that can detect levels of p‐tau in blood plasma. Increasing levels of p-tau, whether visualized with PET or measured in blood plasma, indicates increasing disease burden. Data generated by pharmaceutical companies indicates that individuals with lower AD pathology at baseline, as reflected by lower levels of p‑tau, have greater response to amyloid-based therapies.
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Other potentially useful biomarkers include neurofilament light chain, which can indicate dysfunction in membrane trafficking and autophagy processes. Quantitative EEG and PET imaging agents as well as vMRI may also have utility in several neurodegenerative disorders to measure synaptic function, synaptic density and brain atrophy, respectively.
The Role of Aβ Oligomers on Synapses and the Downstream Impact to Brain Function and AD
Synapses are specialized points of contact between neurons, where electrical signaling and communication takes place. It is well established that synapses are routinely sprouted and resorbed as part of the normal process of learning and memory. Each neuron is covered with an estimated 10,000 synapses and these synapses participate in a complex electrical circuit with other neurons. Neurons do not divide or reproduce as part of normal physiological function.
Scientific evidence has demonstrated that Aβ oligomers, formed over time through the buildup of Aβ and its aggregates, bind to specific parts of the synaptic structure and interfere with the normal process of memory formation. This ligand-like activity confers to Aβ oligomers potent synaptotoxic activity. In response, the neuron dismantles and resorbs the synaptic structure to prevent its abnormal function from interfering with what remains of the normal circuit behavior. If a large enough number of synapses are lost, the neuron dies.
Synaptic loss, however, is not necessarily permanent and synapses can be regained or sprout again once the oligomers are removed. We have observed this process in our research involving preclinical AD models. This observation leads us to believe that displacement of synaptotoxic Aβ oligomers may enable synapses to recover and potentially slow cognitive decline. We are further encouraged by the numerous precedents which exist that demonstrate the therapeutic utility of blocking ligand-receptor interactions in the brain with small molecule drugs capable of crossing the blood-brain barrier.
Zervimesine’s Mechanism of Action Prevents Binding of Aβ Oligomers
Our proprietary zervimesine product candidate employs a novel and fundamentally different mechanism compared to other approved or experimental treatments, which facilitates removal of neurotoxic Aβ oligomers through alteration of S2R activity. Experimental evidence suggests that Aβ oligomers likely occupy binding sites contiguous to the S2R complex. The preferential binding of zervimesine to the S2R complex produces changes that alter the binding affinity of Aβ oligomers to their targets. Zervimesine binding to the S2R complex is hypothesized to modulate the conformation of the S2R complex, which in turn allosterically alters the oligomer receptors causing displacement of Aβ oligomers from the neurons and neuronal synapse. Displaced Aβ oligomers are less able to rebind as long as threshold concentrations of zervimesine are present and are rapidly removed from the synapse. Based on our preclinical studies, we believe that zervimesine not only prevents binding of Aβ oligomers, displacing them from neuronal synapses, but also slows Aβ oligomer-induced loss of synapses and restores synaptic activity, which may reverse downstream synaptotoxic effects.
Zervimesine Clinical Results in AD
We have completed multiple clinical trial evaluations of zervimesine, in both healthy volunteers and patients with mild-to-moderate AD, and have one clinical trial ongoing (START) in patients with MCI or early AD. The clinical trials we have conducted to date have enabled us to evaluate the safety profile of zervimesine; validate its mechanism through proof-of-concept trials; assess clinical efficacy signals; and identify predictive biomarkers of treatment response. The following is the status of our completed and ongoing clinical trials.
Overview of our Completed and Ongoing Clinical Studies of Zervimesine for AD
COG0201 — Phase 2 (SHINE) Clinical Trial
Our COG0201 SHINE study was a randomized, double-blind, placebo-controlled Phase 2 clinical trial designed to evaluate the safety and efficacy of zervimesine. A total of 153 adults with mild-to-moderate AD were enrolled and divided into two zervimesine dose groups (100 mg or 300 mg) and one placebo group, dosed daily for six months. Endpoints included safety and biomarker evidence of disease modification as well as cognitive function, as measured by ADAS-Cog 11. ADAS-Cog 11 is a globally recognized cognitive scale that is used to assess cognition in patients with AD. Top-line results were reported in July 2024 with additional data reported in October 2024.
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A prespecified analysis conducted on SHINE results identified plasma p-tau217 as a biomarker that may predict an optimal therapeutic response in patients with mild-to-moderate AD. Participants treated with zervimesine (pooled 100 mg and 300 mg) who had baseline levels of plasma p-tau217 below the median of 1.0 pg/mL experienced a 95% reduction of cognitive decline at week 26 as measured by ADAS-Cog 11 relative to placebo-treated participants. We believe P-tau217 is an important biomarker that has shown the ability to distinguish Alzheimer’s disease from other neurodegenerative disorders with a high degree of accuracy compared to other available biomarkers.
In the overall modified intent-to-treat, or mITT, population in SHINE, participants treated with once-daily oral zervimesine experienced less cognitive decline than those treated with placebo. As measured with ADAS-Cog 11, zervimesine-treated participants (pooled 100 mg and 300 mg) experienced a mean 38% slowing of decline at six months versus baseline compared to placebo-treated, but did not achieve statistical significance. There were consistent trends favoring zervimesine in other cognitive measures: ADAS-Cog 13, cognitive composite, MMSE; as well as in functional measures of activities of daily living (ADCS-ADL) and of clinical global impression of change (ADCS-CGIC). No discontinuations due to AEs occurred in the 100 mg zervimesine group. At the 300 mg dose, ten participants (nine at scheduled visits and one at an unscheduled visit) experienced treatment-emergent liver enzyme test (“LFT”) increases (greater than 3xULN) that subsided after cessation of drug without evidence of serious liver injury. There were no LFT elevations observed in the 100 mg dose.
Proteomic measurements were also performed on cerebrospinal fluid (CSF) and plasma from these patients, from which we have comprehensive datasets of whole proteome changes observed in AD patients given zervimesine versus placebo for six months. From this, we identified product candidate pharmacodynamic biomarkers that could reflect processes of target engagement, pathway engagement and/or early disease modification.
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COG0203 — Phase 2 START Clinical Trial
Our COG0203 study, referred to as START, is a randomized, double-blind, placebo-controlled Phase 2 clinical trial that is currently enrolling 540 patients with early-stage AD and using the Clinical Dementia Rating Scale Sum of Boxes; or CDR-SB to show a change in the rate of cognitive and functional decline. We are recruiting patients with MCI due to AD or mild AD who have elevated levels of Aβ as determined by PET imaging or as measured in CSF. The trial is being conducted in collaboration with ACTC and will utilize approximately 50-60 sites including research sites associated with the consortium, as well as other qualified sites that are not part of the consortium. Patients will be randomized to receive zervimesine or placebo for 18 months. In addition to a battery of cognitive and functional measures, we intend to use a variety of biomarkers to measure target engagement and assess changes in neurodegeneration and disease progression. We have been awarded a grant of approximately $81 million from the NIA to fund this trial.
Completed Proof-of-Concept Clinical Trials for the Mechanism of Zervimesine
COG0202 — Phase 2 SEQUEL Clinical Trial
Our COG0202 SEQUEL study is a randomized, double-blind, placebo-controlled Phase 2 clinical trial of 16 patients with mild-to-moderate AD to evaluate the potential efficacy of zervimesine in restoring synaptic function in patients through quantitative EEG (qEEG) measurement, as reflected by relative theta power. The trial is a two-arm crossover trial, in which half of the participants received 300 mg of zervimesine daily for 29 days. After a 14-day wash out period, these participants received placebo for an additional 29 days. The other half of the participants received placebo daily for 29 days. After a 14-day wash out period, these participants received zervimesine treatment for an additional 29 days. CSF and qEEG evaluations were taken periodically throughout the duration of the trial. We completed enrollment in the first quarter of 2023 and presented results in October 2023. Results showed that zervimesine-treated participants exhibited a significant change in relative theta in the central region of the brain and consistent trends of improvement across all prespecified EEG parameters, reflecting improved synaptic function after just a matter of weeks.
COG0105 — Phase 1 SPARC Clinical Trial
The COG0105 SPARC study is a randomized, double-blind, placebo-controlled Phase 1 clinical trial of 23 patients with mild-to-moderate AD. The primary objectives of the study were to evaluate zervimesine for safety and tolerability. The secondary objectives were to evaluate potential effects of zervimesine on biologically relevant endpoints using various imaging modalities, including PET imaging and volumetric MRI (vMRI) as well as CSF biomarkers, and cognitive and clinical endpoints.
Participants were randomized to receive treatment with 100 mg or 300 mg of zervimesine or placebo once daily for 24 weeks. A preliminary analysis has been made of safety, clinical laboratory measurements, PET imaging, functional MRI and vMRI, CSF biomarkers and clinical outcomes in patients treated with zervimesine compared to those in patients receiving placebo.
Seventeen patients completed the study protocol, eleven in the zervimesine arm (six in the 100 mg cohort; five in the 300 mg cohort) and six in the placebo arm. Zervimesine was well tolerated with similar adverse event rates across treatment arms. Most adverse events were mild or moderate in severity with no deaths and no treatment-related SAEs reported. We observed mild and transient elevations of liver enzymes without any other indications of liver injury in two patients in the 300 mg group. The patients were discontinued from the study and the liver enzyme levels returned to normal.
Top-line results from the analyses of secondary endpoints demonstrated that after 24-weeks of treatment, there were no significant treatment differences on the ADAS-Cog 11 change from baseline. In addition, there were no significant treatment differences on SV2A signal change compared to baseline. However, vMRI showed a trend (p=0.0641) towards a significant reduction in the loss of composite brain volume in zervimesine-treated patients (pooled) compared to placebo. A significant (p<0.05) reduction in loss of brain volume was also observed in three brain regions (hippocampus, prefrontal cortex and pericentral cortex) in treated patients (pooled) compared to placebo, as shown in the table below.
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LS Mean Change from Baseline in vMRI (composite) over Time by Treatment
COG0104 — Phase 1 SNAP Clinical Trial
Our COG0104 SNAP study was a randomized, double-blind, placebo-controlled Phase 1 clinical trial that enrolled three patients with mild-to-moderate AD to measure the effects of zervimesine on displacement of Aβ oligomers. Patients were randomized 2:1 to receive a single dose of zervimesine (n=2) or placebo (n=1). Patients enrolled in the trial had an indwelling catheter placed in the lumbar CSF space. CSF samples were collected hourly over a 28-hour period. Five CSF samples were collected before and 24 samples collected after administration of a single 560 mg oral dose of zervimesine or placebo. CSF samples from each trial participant were analyzed to measure the concentration of Aβ oligomers over the trial period.
Results of this clinical trial revealed an increase in Aβ oligomer levels in the CSF over the 24-hour period following treatment with zervimesine, but not in the patient administered placebo. These findings were measured using two independent methods, microimmunoelectrodes and western blots. This effect of zervimesine was specific to Aβ oligomers, as no zervimesine-related increase in Aβ 1-40 or 1-42 monomer was observed. We believe that these results corroborate our mechanism of action previously demonstrated in preclinical studies, providing the first evidence that our preclinical studies translate to patients with AD.
First evidence of target engagement in humans, which mirrors that found preclinically; and we believe this reinforces that our mechanism of action extends to patients with AD
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COG0102 — Phase 1 Clinical Trial
Our COG0102 study was a randomized, double-blind, placebo-controlled, Phase 1 clinical trial of 19 patients with mild-to-moderate AD. Participants were administered one of three oral doses of zervimesine, either 90 mg, 280 mg or 560 mg, once daily for 28 days. The primary endpoint of the trial was safety with a secondary objective of establishing the pharmacokinetic, or PK, profile of zervimesine. Also included as exploratory endpoints were measurement of zervimesine in CSF, and protein expression changes in CSF and plasma.
Zervimesine was well tolerated in the COG0102 study. All AEs were mild or moderate. Some of the participants in the highest dose group experienced lymphocytopenia or elevated liver enzymes. These laboratory abnormalities resolved in most patients with continued dosing of zervimesine. One trial participant was discontinued from zervimesine prior to study completion because of elevated liver enzymes with subsequent resolution of this abnormality. Lymphocytopenia or elevated liver enzymes were not observed in either the 90 mg or 280 mg dosing cohorts. There were no SAEs.
Our Phase 1 Safety Trials with Zervimesine
In addition to Phase 1 clinical trials conducted in our targeted patient population, we also conducted a series of Phase 1 clinical trials in healthy volunteers to evaluate the safety profile of zervimesine; as well as numerous preclinical in vitro and in vivo studies to assess its neuroprotective function as well as determine potential drug-food or drug-drug interactions. These trials and their results, which are summarized below, indicated that zervimesine was generally well tolerated.
COG0101 — First in Human Phase 1 Clinical Trial
Our COG0101 study was a randomized, double-blind, placebo-controlled ascending dose Phase 1 multi-cohort clinical trial of 93 healthy volunteers to assess the safety and potential drug-food interactions of zervimesine. The trial was conducted in two segments.
The first segment was structured as an ascending single dose trial, in which participants received one dose of zervimesine with increasing doses given to each of six cohorts. In this segment of the trial, eight participants were enrolled per dosing cohort with six participants receiving zervimesine and two receiving placebo. The doses evaluated were 10 mg, 30 mg, 90 mg, 180 mg, 450 mg and 1,120 mg. A seventh cohort of six patients received a single 90 mg dose after receiving a standardized meal. All doses were administered as scheduled.
The second segment was configured as a multiple ascending dose trial, that enrolled 39 healthy volunteers, divided in three cohorts of ten participants, with one additional cohort consisting of nine healthy elderly volunteers. Each participant in this segment of the trial received a single dose of zervimesine each day for 14 days. The doses evaluated in this second segment were 280 mg, 560 mg and 840 mg.
Zervimesine CSF concentrations correlated to a >80% S2R predicted receptor occupancy in brain
Following completion of each trial cohort, bioanalytical evaluation of plasma zervimesine PK was conducted.
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This trial demonstrated that administration of zervimesine in single doses of up to 1,120 mg, administered once, as well as up to 840 mg of zervimesine dosed for 14 consecutive days was well tolerated. Significantly, zervimesine concentrations detected in the CSF correlated to an estimated receptor occupancy in the brain of greater than 80%. There was one SAE in the multiple-dose portion of the study that was deemed unrelated to study drug. There were no SAEs related to the product candidate or TEAEs leading to withdrawal from the study.
COG0103 — Phase 1 Clinical Trial
Our COG0103 study was a Phase 1 clinical trial of 15 healthy volunteers designed to evaluate the potential effects of zervimesine on select CYP isoenzymes: CYP2C19, CYP2C9, CYP2D6 and CYP3A4/5. This was accomplished by assessing its effects on substrates of these isoenzymes: 20 mg omeprazole, 500 mg tolbutamide, 50 mg dextromethorphan and 4 mg midazolam. The 15 healthy volunteers who participated in the trial received the substrates of these isoenzymes two days prior to the initial dose of zervimesine and PK assessments were performed. A dose of 560 mg of zervimesine was administered to each of the trial participants for the following six consecutive days. The Day 6 dose of zervimesine was administered concomitantly with the four-substrate cocktail and PK assessments were repeated.
A weak drug interaction was observed between zervimesine and midazolam and dextromethorphan. A lack of any clinically meaningful interaction was observed with coadministration of omeprazole or tolbutamide. Based on the small magnitude of change in PK parameters of the probe drugs observed in this study for the isoenzymes CYP2D6 and CYP3A4, clinically meaningful interactions are unlikely.
In all blinded and unblinded clinical trials, several patients experienced asymptomatic, reversible elevations in serum liver chemistries prompting harmonization of monitoring, increasing frequency where appropriate, across our clinical trials.
Preclinical Results
Prior to entering clinical trials, the therapeutic potential of zervimesine was observed in numerous preclinical studies. As is demonstrated in the images below, the addition of Aβ oligomers to neuronal cell cultures resulted in synaptotoxicity as illustrated by the reduced expression of synaptic markers neurogranin, synaptotagmin and SV2A. The lack of immunoreactivity of these three synaptic proteins can be seen in the middle column of the image below. However, the presence of zervimesine blocked the Aβ oligomer-induced loss of synapses, as reflected by the presence of synaptic protein expression displayed in the right-hand column below.
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Zervimesine prevented Aβ oligomer-mediated synaptic damage
Results showed that zervimesine also slowed the loss of synapses that is triggered by Aβ oligomers. A higher resolution image of the cell culture exposed to Aβ oligomer is shown below, before the addition of zervimesine, which is presented on the left, and after the addition of zervimesine, which is presented on the right. Aβ oligomers shown in red bind to synaptic receptors and reduces the number of synapses shown in green. The addition of zervimesine displaces Aβ oligomer binding and appears to block the effects induced by the Aβ oligomers, with the synapse numbers remaining at levels similar to normal.
Zervimesine slowed loss of synapse numbers in the presence of Aβ oligomers
The protective benefits of zervimesine observed in these in vitro assays are supported by functional in vivo assessments of zervimesine. In one such preclinical study, the memory of mice was tested based on the subject’s ability to recall fear-inducing triggers and its performance in a maze. The mice exhibiting symptoms of AD, depicted by the red bars in the image below, performed significantly worse in both the fear and maze tests when compared to normal, non-transgenic mice, represented by the blue bars. However, after administration of zervimesine, the AD mice, represented by the solid green bars, were seen to perform at a level similar to that achieved by normal mice. We believe these results are illustrative of zervimesine’s ability to restore synaptic proteins and numbers to normal levels and with it, the animal’s functional capabilities.
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Zervimesine restored functional capabilities in a mouse model of AD
Dementia with Lewy Bodies (DLB)
Substantial cellular and clinical biomarker evidence demonstrate that zervimesine may have a beneficial impact on the pathways impaired in synucleinopathies, namely the localization of α-synuclein aggregates in Lewy bodies, which is a chief hallmark of DLB, Parkinson’s disease (PD) and other synucleinopathies. More recently, human genetic evidence has linked SNCA, the gene encoding α-synuclein, to the pathology of synucleinopathies.
We have conducted preclinical studies of compounds in our library, including zervimesine, to explore their potential to rescue the biological processes that are impaired in synucleinopathies. We are currently developing zervimesine for the treatment of DLB.
An Overview of DLB
DLB is the second most common cause of dementia. The abnormal accumulation of the protein α-synuclein into fibrils, the primary component of the Lewy bodies within brain neurons, is characteristic of DLB. Increasing evidence suggests that α-synuclein oligomers disrupt key cellular processes including autophagy and elicit neuronal dysfunction and loss of synapses.
DLB is challenging to diagnose and identify as it shares many Alzheimer’s disease symptoms. DLB is referred to as a “whole-body” disease, as it disrupts biological processes affecting autonomic, digestive, cognitive, and motor systems. Varied initial symptoms may include day-to-day fluctuations in alertness level, hallucinations, delusions, movement disorders and REM sleep disorder (acting out dreams while sleeping).
In the United States, an estimated 1.4 million are diagnosed with DLB. According to the Lewy Body Dementia Association, the direct healthcare costs for patients with DLB are estimated to be approximately $31 billion per year.
Limitations of Current Treatments
Most approved therapeutic products treat the symptoms of the diseases and modulate dopamine. While some existing products provide meaningful symptomatic relief, they have significant side effect risks, fail to address the progression of the disease, and over time gradually lose their effectiveness in treating the symptoms of the disease. There are no currently approved disease-modifying therapeutics for DLB.
Rationale for Zervimesine in the Treatment of DLB
The protein α-synuclein is primarily found in neural tissue that plays a role in neurotransmission. In DLB, α-synuclein builds up in brain cells and forms oligomers that saturably bind to neurons where they impair critical cellular processes, causing synaptic dysfunction. Our decision to pursue the treatment of synucleinopathies with zervimesine is based on internal and third-party data, indicating that zervimesine can prevent binding synuclein oligomers and that the S2R components PGRMC1 and TMEM97 regulate cell pathways known to be impaired in synucleinopathies, such as autophagy, vesicle trafficking and lipid synthesis; α-synuclein oligomers bind directly to PGRMC1; and synucleinopathies share certain mechanistic similarities with AD, including pathologies related to aberrant oligomeric protein formations.
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As summarized below, we believe our preclinical studies provide compelling evidence supporting the use of zervimesine as a potential therapeutic to treat DLB.
As with oligomers of the Aβ protein in AD, oligomers of α-synuclein are highly toxic when bound to brains cells and internalized. This binding causes cellular stress, including three major pathway disruptions: upregulation of the autophagy receptor LAMP2A, dysregulation of lipid metabolism and a reduction in membrane trafficking. The S2R complex components, PGRMC1 and TMEM97, directly regulate these processes and activities which are compromised by the binding and internalization of α-synuclein oligomers.
Compounds that block α-synuclein binding and/or internalization are therefore expected to be disease-modifying.
Preclinical Study Support for Clinical Trials
The results of in vitro studies suggest that S2R modulator, such as zervimesine, may have disease-modifying effect on the synucleinopathies by reversing pathway disruption and dysregulation caused by α-synuclein oligomers. In work funded by grants from the Michael J. Fox Foundation, α-synuclein oligomers were found to bind to brain cells in culture and are internalized as indicated by the red dots in the image to the left below. With the addition of zervimesine, the binding and thus internalization of the α-synuclein oligomers is inhibited as indicated in the image to the right below.
Zervimesine blocked the binding and internalization of α-synuclein oligomers in the neuronal synapses
The potential for S2R modulators like zervimesine to reverse the deleterious cellular effects of α-synuclein oligomers is also reflected in the in vitro analysis of LAMP2A expression presented below. LAMP2A is a critical component of chaperone-mediated autophagy, one of several processes that eliminate damaged cellular proteins. Its expression, noted in orange, is upregulated in the presence of the toxic α-synuclein oligomer, likely a compensatory mechanism in response to the cellular insult. S2R modulators, which block membrane trafficking deficits caused by α-synuclein oligomers, are observed to inhibit the upregulation of LAMP2A, as evidenced by the dark and light gray in the below chart. As these antagonists are selective for the S2R complex, their ability to reverse the effects of α-synuclein on LAMP2A expression provides compelling evidence of the S2R complex’s importance in the regulation of this autophagy pathway.
In vitro analysis further illustrates α-synuclein oligomers’ dose-dependent inhibition of membrane trafficking. Importantly, oligomer-related inhibition was noted to be four-fold higher than that observed with high concentrations of monomeric α-synuclein, illustrative of the significantly greater toxicity of α-synuclein oligomers. The addition of zervimesine was observed to reverse the membrane trafficking deficit related to the presence of α-synuclein oligomer, while having no effect on membrane activity when dosed in its absence.
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S2R antagonists reversed the effects of α-synuclein oligomers on LAMP2A expression and trafficking
COG1201 — Phase 2 SHIMMER Clinical Trial
We completed the double-blind, randomized Phase 2 COG1201 (SHIMMER) clinical trial of zervimesine in adults with mild-to-moderate DLB. We enrolled 130 participants who were randomized evenly to one of three dose groups: two treated with once-daily oral zervimesine (100 mg or 300 mg) and one treated with placebo. To be eligible, participants were between 50 and 80 years of age, received a diagnosis of probable DLB, and had a mini-mental state exam, or MMSE, score of between 18 and 27. Clinical endpoints of the trial included safety and tolerability, neuropsychiatric, functional, cognitive and physical activity measurements. PK and pharmacodynamic biomarker analyses were also conducted.
The study met its primary endpoint of safety and tolerability. Zervimesine-treated DLB patients scored an average of 86% better than placebo-treated patients on the neuropsychiatric inventory (NPI) A-L at the end of the study. This tool describes the frequency and severity of 12 behavioral symptoms including hallucinations, delusions and anxiety. Compared to placebo-treated participants, those treated with zervimesine performed an average of 52% better on the ADCS-ADL scale, a measure of activities of daily living; an average of 91% better on the CAF, a measure of cognitive fluctuations; an average of 62% better on the Unified Parkinson's Disease Rating Scale (UPDRS) Part III, a measure of motor function such as gait, balance, and tremor.
Other Initiatives
Zervimesine and other chemical structures in our pipeline originate from a screening technique developed by Cognition’s founding scientists. This screening technique relies on the use of mature primary neuronal cultures designed to replicate the mature brain and its intricate connections and patterns of electrical signaling. provides us with information-rich measurements more indicative of normal brain function and predicative of functional benefit.
Cognition has generated proprietary small molecule libraries derived from natural chemical scaffolds through a proprietary process which we refer to as conditioned extraction. Conditioned extraction was pioneered by a cofounder and allows us to eliminate undesirable properties of well characterized, biologically active compounds sourced from natural products, while retaining their biological activity. The resulting molecular configurations are then subjected to proprietary functional in vitro screening using the mature primary neuronal cultures.
The candidate library produced through this process is predisposed to compounds with attractive drug-like properties such as low molecular weight, low number of reactive hydrogen bonds, lipophilicity and relatively neutral chemistry properties. These characteristics reduce the reactivity of the molecules and related toxicities, while also enhancing their ability to cross the blood-brain and blood-retina barriers, which we believe will reduce development risk. We also believe this platform provides us with differentiated libraries which may lead to development candidates beyond zervimesine.
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Geographic Atrophy (GA) Secondary to Dry Age-Related Macular Degeneration (Dry AMD)
We believe that several lines of evidence suggest that zervimesine may be effective in the treatment of GA secondary to dry AMD. Human genetics points to TMEM97 as a promising therapeutic target for GA secondary to dry AMD, as indicated via several large-scale, independent genome-wide association, or GWA, studies. In addition, unbiased pathway analysis of AD patient proteomic data obtained during our clinical trials provides independent evidence of a relationship between the S2R complex and GA secondary to dry AMD.
Early proof-of-concept studies with zervimesine indicate a role of S2R modulators in rescuing key aspects of dry AMD including maintaining homeostatic functions of retinal pigment epithelial cells (RPEs), ameliorating lysosomal dysfunction and preventing RPE cell death. PK assessment indicates that we can achieve therapeutic levels (>80% receptor occupancy) of zervimesine in retinal tissue through oral administration.
In 2023 we initiated the Phase 2 COG2201 MAGNIFY study of zervimesine in adults with geographic atrophy secondary to dry AMD. In December 2024 MAGNIFY passed a masked futility analysis conducted by the contract research organization, or CRO, which provided evidence that zervimesine treated patients were experiencing a slower lesion growth rate than those on placebo. However, in January 2025, we made the strategic decision to focus our resources on our promising dementia programs in AD and DLB. Therefore, we voluntarily discontinued the MAGNIFY clinical study. The discontinuation was not the result of any safety concerns. At the time of the discontinuation, 100 participants had been enrolled. Results are being compiled by the contract research organization (CRO) following participant completion of final clinic visits. We will conduct an analysis of the changes in GA lesion size as well as safety and tolerability, which will be reported at a later date. We continue to believe that zervimesine has the potential to alter the biological processes that contribute to dry AMD.
Proposed Synucleinopathies Clinical Program
Subject to additional funding, we may plan to study several next-generation S2R modulators derived from chemically distinct series to measure their ability to rescue cell death in synucleinopathies such as PD and DLB. We may also study α-synuclein pathology and motor deficits in two mechanistically distinct in vivo models of synucleinopathies. In parallel, these studies will elucidate the mechanism of action by which S2R modulators are efficacious in PD and DLB and provide essential data to support potential biomarker nomination for PD and DLB.
Additional Product Candidates
Many degenerative disorders are likely to involve a dysfunctional cellular damage response mechanism and significant evidence is emerging which highlights the importance of the S2R complex and its components in regulating this response. The complex likely contains a number of relevant binding sites that may allow for multiple disease intervention approaches, making it an attractive therapeutic target. Accordingly, we have engaged in a number of earlier-stage discovery programs which are built upon our identification of five structurally distinct chemical series. From these series we have multiple leads which will be optimized from each of our lead series. Each of these leads has demonstrated favorable potency with variable selectivity in early preclinical testing and each of the molecular series possesses distinct bioavailability and PK properties, including differences in half-life and blood-brain and blood-retina permeability.
Our Team and Collaborators
We have assembled a management team with extensive experience with CNS and degenerative diseases, significant expertise in the drug discovery, clinical development, general management and business development. Collectively, our management team has a track record of managing drug development programs that have received regulatory approval and been successfully commercialized.
In addition, our management team has built companies that have initiated innovative technologies and investigational new drug programs. We augment the strengths of our management team with an experienced board of directors and scientific and medical advisory boards. We believe our team, with its deep scientific and drug development background, positions us to become a leader in the development of therapies for age-related degenerative diseases and disorders.
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Since our inception, we have collaborated and worked closely with key healthcare organizations and thought leading institutions in the field of degenerative diseases to develop and advance our therapeutic candidates. To date, we have been awarded approximately $171 million in cumulative grants awarded primarily from the NIA to support our clinical trials.
Grant Funding
Historically, we have sought grant funding to strategically advance our programs. To date, we have secured non-dilutive funds from the NIA, the Michael J. Fox Foundation and other groups to pursue our commonly aligned interests of developing therapeutics for neurodegenerative disorders. The company has been awarded $171 million in cumulative grants for the advancement of our pipeline programs. As of December 31, 2024, we had approximately $50 million available from NIA funds for applicable expenses to be incurred in the future.
Funding Org
Year
Project
Amount
National Institute on Aging (NIH)
2016
COG0101 Ph1b first-in-patient trial for CT1812
$
2,410,669
National Institute on Aging (NIH)
2016
COG0102 Ph1b/2a Clinical Trial for CT1812
$
2,410,669
National Institute on Aging (NIH)
2017
COG0104 Ph1 SNAP Study: CSF Catheter
$
2,527,271
National Institute on Aging (NIH)
2017
COG0105 Ph1 SPARC Study: SV2a PET
$
4,795,774
National Institute on Aging (NIH)
2018
COG0201 Ph2 SHINE Study
$
16,848,329
National Institute on Aging (NIH)
2019
COG0202 Ph2 SEQUEL Study: qEEG
$
5,445,051
National Institute on Aging (NIH)
2020
COG0203 Ph2 START Study with ACTC
$
80,974,766
National Institute on Aging (NIH)
2021
COG0108 Study: hAME
$
1,642,783
National Institute on Aging (NIH)
2021
COG0201 Ph2 SHINE Amendment
$
13,634,548
National Institute on Aging (NIH)
2021
COG1201 Ph2 SHIMMER Study: DLB
$
29,498,048
NIH and others
2010‑2021
Ten Preclinical Programs
$
10,859,971
$
171,047,879
Each of the grants awarded to us relates to agreed-upon direct and indirect costs for specific studies or clinical trials, which may include personnel and consulting costs, costs paid to CROs, research institutions and/or consortiums involved in the grant, as well as facilities and administrative costs. These grants are cost plus fixed fee arrangements in which we are reimbursed for our eligible direct and indirect costs over time, up to the maximum amount of each specific grant award. Only costs that are allowable under the grant award, certain government regulations and the NIH’s supplemental policy and procedure manual may be claimed for reimbursement, and the reimbursements are subject to routine audits from governmental agencies from time to time. While these NIA grants do not contain claw back provisions, the NIA or other government agency may review our performance, cost structures and compliance with applicable laws, regulations, policies and standards and the terms and conditions of the applicable NIA grant. If any of our expenditures are found to be unallowable or allocated improperly or if we have otherwise violated terms of such NIA grant, the expenditures may not be reimbursed and/or we may be required to repay funds already disbursed. To date, we have not been found to have breached the terms of any NIA grant.
Intellectual Property
We seek to protect and enhance our proprietary technology, inventions, and improvements that are commercially important to the development of our business by seeking, maintaining, and defending patent rights, in the United States and internationally, whether developed internally or licensed from third parties. We will also seek to rely on regulatory protection afforded through inclusion in expedited development and review, data exclusivity, market exclusivity and patent term extensions where available.
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Company Owned Intellectual Property
As of March 1, 2025, our intellectual property portfolio contained ten issued U.S. patents, forty five issued foreign patents as well as five pending U.S. provisional applications, three pending U.S. patent applications, one pending Patent Cooperation Treaty applications and forty five foreign pending patent applications directed to the composition of matter of, pharmaceutical compositions of, methods of use of, and methods for selecting subsets of patients for treatment with our chemical structures, including our lead zervimesine . Our current issued patents relating to zervimesine are projected to begin to expire no earlier than 2035, with the composition of matter patent covering zervimesine set to naturally expire in 2035, subject to adjustment or extension of patent term available in a particular jurisdiction. We will likely be awarded Patent Term Extension, or PTE, when zervimesine is approved as a New Chemical Entity, or NCE, that will extend the term of the zervimesine composition of matter patent by up to five years, and we anticipate pursuing additional patents to further protect zervimesine and to further extend the patent term associated with zervimesine . We expect to file additional patent applications in support of current and new product candidates as well as new platform and core technologies.
We are the exclusive owner of eight patent families that include several granted U.S. patents and pending U.S. patent applications, as well as granted patents and pending patent applications in numerous foreign jurisdictions, relating to compositions of matter and pharmaceutical compositions of zervimesine , analogs of zervimesine , and the use of zervimesine for the treatment in certain diseases, disorders and conditions including AD, GA secondary to dry AMD, DLB, PD, and other synucleinopathies.
The first of these patent families is directed to compositions of matter of zervimesine, pharmaceutical compositions of zervimesine, methods of using zervimesine for inhibiting amyloid beta effects on a neuronal cell, and methods of using zervimesine to treat AD, and we are the exclusive owner of this patent family in the United States and certain foreign jurisdictions, including Australia, Brazil, Canada, China, the European Union, Hong Kong, India, Israel, Japan, South Korea, Mexico, New Zealand, Russia, and South Africa. As of March 1, 2025, this patent family includes granted patents claiming composition of matter of zervimesine , pharmaceutical compositions of zervimesine , methods of using zervimesine for inhibiting amyloid beta effects on a neuronal cell, and methods of using zervimesine to treat AD in the United States (three patents), Australia, Brazil, China, the European Union, Hong Kong, India, Israel, Japan, New Zealand, Mexico, South Korea, Russia and South Africa. This patent family also includes a pending U.S. patent application and pending application in the European Union. This patent family has a natural expiration date in 2035 subject to any adjustment or extension of patent term that may be available in in a particular jurisdiction such as PTE following approval of the New Drug Application, or NDA, in the United States or extension of patent term via a Supplementary Protection Certificate, or SPC, following EMEA marketing authorization. Upon approval of the NDA for zervimesine in the United States, the patents in this family claiming compositions of matter of zervimesine , pharmaceutical compositions of zervimesine , and methods of using zervimesine for inhibiting amyloid beta effects on a neuronal cell, and methods of using zervimesine to treat AD will be eligible to be listed in the FDA’s publication “Approved Drug Products with Therapeutic Equivalence Evaluations,” or the Orange Book. These patents complement the regulatory exclusivity by providing the basis for an additional waiting period prior to the FDA’s approval of an abbreviated new drug application, or ANDA, or 505(b)(2) applicant. If an ANDA or 505(b)(2) applicant were to file its application referencing the NDA for zervimesine before expiration of our composition of matter, pharmaceutical composition, and method of use patents and the applicant asserted that our patents identified on the Orange Book to be invalid or not be infringed, it may be subject to additional waiting periods prior to the FDA’s approval (including a statutory 30-month stay if we sue for infringement, or a shorter period if the patent expires or there are certain settlements or judicial decisions in the patent litigation, starting at the end of the five-year NCE regulatory exclusivity period).
In addition to patent exclusivity, under the provisions of the Hatch-Waxman Act, upon any approval in the United States, we believe that zervimesine will be eligible for five-year NCE regulatory exclusivity, during which time no 505(b)(2) NDA or ANDA can be approved that contains the same active moiety as the chemical entity in the zervimesine NDA. When approved in Europe, zervimesine will also be eligible for 10 years of data and market exclusivity which is extendible for an additional year upon market authorization for one or more new indications during the first eight years of the data and market exclusivity period.
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We also own seven families of pending patent applications directed to methods for selecting subsets of patients with AD for treatment with zervimesine , methods of modulating amyloid beta monomer and oligomer levels using zervimesine , methods of treating GA secondary to dry AMD with zervimesine and methods of treating various neurologic diseases including PD, DLB and other synucleinopathies with zervimesine , as well as a pending provisional application directed to treating certain subsets of AD patients with zervimesine and treating Niemann-Pick disease. Any of these applications, if issued, will have a natural expiration between 2038 and 2044, subject to any adjustment or extension of patent term that may be available such as PTE following NDA approval in the United States as well as any term limitations based upon earlier expiring patents.
Additional Product Candidates
We are the exclusive owner of four patent families that include several pending U.S. patent applications, as well as pending patent applications in numerous foreign jurisdictions directed to additional product candidates. These patent families have expirations no earlier than 2038 subject to any adjustment or extension of patent term that may be available such as PTE following NDA approval in the United States as well as any term limitations based upon earlier expiring patents.
Manufacturing Strategy
We oversee and manage third party contract manufacturing organizations to support development and manufacture of product candidates for our clinical trials, and, if we receive marketing approval, we will rely on such manufacturers to meet commercial demand. We expect this strategy will enable us to maintain a more efficient infrastructure, avoiding dependence on our own manufacturing facility and equipment, while simultaneously enabling us to focus our expertise on the clinical development and future commercialization of our products. Currently, we rely on and have agreements with a single third-party contract manufacturer to supply the zervimesine drug substance and with a single third-party contract manufacturer to manufacture clinical trial supplies of zervimesine. We expect to enter into commercial supply agreements with such manufacturers prior to any potential approval of zervimesine. We continue to develop the commercial route for zervimesine drug substance and to meet all requirements for our planned clinical trials. The current drug substance manufacturer is able to support all of our needs for the planned clinical studies and commercial supplies.
Zervimesine drug product is manufactured via conventional pharmaceutical processing procedures, employing commercially-available excipients and packaging materials. The procedure and equipment employed for manufacture and analysis are consistent with standard pharmaceutical production, and are transferable to a range of manufacturing facilities, if needed. We will transition from our current drug product manufacturer to a larger third-party manufacturer for our late-stage clinical and commercial supply.
Commercialization Strategy
We currently have no marketing, sales or distribution capabilities. In order to commercialize any products that are approved for commercial sale, we must either develop a sales and marketing infrastructure or collaborate with third parties that have sales and marketing experience.
We may seek third-party support from established pharmaceutical and biotechnology companies for those products that would benefit from the promotional support of a large sales and marketing force. In these cases, we might seek to promote our products in collaboration with marketing partners or rely on relationships with one or more companies with large established sales forces and distribution systems.
We may elect to establish our own sales force to market and sell a product for which we obtain regulatory approval if we expect that the geographic market for a product we develop on our own is limited or that the prescriptions for the product will be written principally by a relatively small number of physicians. If we decide to market and sell any products ourselves, we do not expect to establish direct sales capability until shortly before the products are approved for commercial sale.
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Competition
We face substantial competition from multiple sources, including large and specialty biotechnology and pharmaceutical companies, academic research institutions and governmental agencies and public and private research institutions. Our competitors compete with us on the level of the technologies employed, or on the level of development of product candidates. In addition, many small biotechnology companies have formed collaborations with large, established companies to (i) obtain support for their research, development and commercialization of products or (ii) combine several treatment approaches to develop longer lasting or more efficacious treatments that may potentially directly compete with our current or future product candidates. We anticipate that we will continue to face increasing competition as new therapies and combinations thereof, technologies, and data emerge.
In addition to the current standard of care treatments for patients with neurodegenerative diseases, numerous commercial and academic preclinical studies and clinical trials are being undertaken by a large number of parties to assess technologies and product candidates in the CNS field.
Many of our competitors, either alone or in combination with their respective strategic partners, have significantly greater financial resources and expertise in research and development, manufacturing, the regulatory approval process, and marketing than we do. Mergers and acquisition activity in the biopharmaceutical sector is likely to result in greater resource concentration among a smaller number of our competitors. Smaller or early-stage companies may also prove to be significant competitors, particularly through sizeable collaborative arrangements with established companies. These competitors also compete with us in recruiting and retain qualified scientific and management personnel and establishing clinical trial sites and patient registration for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.
Our commercial opportunity could be reduced or eliminated if one or more of our competitors develop and commercialize products that are safer, more effective, better tolerated, or of greater convenience or economic benefit than our proposed product offering. Currently available therapies for these diseases are limited, with two approved disease-modifying treatments each for Alzheimer’s disease but no approved treatments for dementia with Lewy bodies. However, our competitors also may be in a position to obtain FDA or other regulatory approval for their products more rapidly, resulting in a stronger or dominant market position before we are able to enter the market. The key competitive factors affecting the success of all of our programs are likely to be product safety, efficacy, convenience and treatment cost.
Employees and Human Capital Resources
As of March 1, 2025, we had 28 employees, 25 of whom were full-time and 20 of whom were engaged in research and development activities. Seven of our employees hold Ph.D. or M.D. degrees. None of our employees are represented by a labor union. We consider our relationship with our employees to be good.
We are dedicated to conducting business with the highest standards of corporate responsibility. Our goal is to build a culture of talented and passionate people striving to positively impact patients, our communities, and broader society. Our human capital resource priorities include attracting, recruiting, retaining, incentivizing and integrating our existing and new employees. We promote values such as purpose, drive, transparency, and fairness in our workplace.
The principal purposes of our equity and cash incentive plans are to attract, retain and reward personnel through the granting of stock-based and cash-based compensation awards, in order to increase stockholder value and the success of our company by motivating such individuals to perform to the best of their abilities and achieve our objectives. During 2024, the Company took proactive steps to enhance and improve our policies related to employee welfare and engagement.
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Government Regulation
Government authorities in the United States, at the federal, state, and local level, and other countries extensively regulate, among other things, the research, development, nonclinical and clinical testing, manufacture, quality control, approval, labeling, packaging, storage, record-keeping, promotion, advertising, distribution, post-approval monitoring and reporting, marketing, and export and import of products such as those we are developing. Generally, before a new drug can be marketed, considerable data must be generated, which demonstrate the drug’s quality, safety, and efficacy. Such data must then be organized into a format specific for each regulatory authority, submitted for review and approved by the regulatory authority.
U.S. Drug Development Process
In the United States, the FDA regulates drugs under the federal Food, Drug, and Cosmetic Act, or FDCA, and its implementing regulations. The process of obtaining regulatory approvals and the subsequent compliance with appropriate federal, state, local and foreign statutes and regulations require the expenditure of substantial time and financial resources. Failure to comply with the applicable U.S. requirements at any time during the product development process, the approval process or after approval may subject an applicant to administrative or judicial sanctions. These sanctions could include the FDA’s refusal to approve pending applications, withdrawal of an approval, a clinical hold, warning letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement, or civil or criminal penalties. Any agency or judicial enforcement action could have a material adverse effect on us.
The process required by the FDA before a drug may be marketed in the United States generally involves the following:
● completion of nonclinical laboratory tests, animal studies, and formulation studies in accordance with FDA’s good laboratory requirements and other applicable regulations;
● submission to the FDA of an IND, which must become effective before human clinical trials may begin;
● approval by an independent institutional review board, or IRB, or ethics committee, either centralized or with respect to each clinical site, before each clinical trial may be initiated;
● performance of adequate and well-controlled human clinical trials in accordance with good clinical practices, or GCP, requirements to establish the safety and efficacy of the proposed drug for its intended use;
● submission to the FDA of an NDA after completion of all pivotal trials;
● determination by the FDA within 60 days of its receipt of an NDA to accept the filing for substantive review;
● satisfactory completion of an FDA advisory committee review, if applicable;
● satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the drug is produced to assess compliance with current good manufacturing practices, or cGMP, requirements to ensure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength, quality, and purity, and of selected clinical investigation sites to assess compliance with GCPs;
● FDA review and approval of the NDA to permit commercial marketing of the product for particular indications for use in the United States;
● compliance with any post-approval requirements, including potential requirements to conduct any post-approval studies required by the FDA or the potential requirement to implement a risk evaluation and mitigation strategy, or REMS; and
● compliance with the Pediatric Research Equity Act, or PREA, which requires either exemption from the requirements or may require conducting clinical research in a pediatric population.
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Prior to beginning the first clinical trial with a product candidate in the United States, we must submit an IND to the FDA. An IND is a request for authorization from the FDA to administer an investigational new drug product to humans. The central focus of an IND submission is on the general investigational plan and the protocol(s) for clinical studies. The IND also includes results of animal and in vitro studies assessing the toxicology, PK, pharmacology, and pharmacodynamic characteristics of the product; chemistry, manufacturing, and controls information; and any available human data or literature to support the use of the investigational product. An IND must become effective before human clinical trials may begin. The IND automatically becomes effective 30 days after receipt by the FDA, unless the FDA, within the 30-day time period, raises safety concerns or questions about the proposed clinical trial or drug candidate. In such a case, the IND may be placed on clinical hold and the IND sponsor and the FDA must resolve any outstanding concerns or questions before the clinical trial can begin. Submission of an IND therefore may or may not result in FDA authorization to begin a clinical trial.
Clinical trials involve the administration of the investigational product to human subjects under the supervision of qualified investigators in accordance with GCPs, which include the requirement that all research subjects provide their informed consent for their participation in any clinical study. Clinical trials are conducted under protocols detailing, among other things, the objectives of the study, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated. A separate submission to the existing IND must be made for each successive clinical trial conducted during product development and for any subsequent protocol amendments. Furthermore, an independent IRB for each site proposing to conduct the clinical trial must review and approve the plan for any clinical trial and its informed consent form before the clinical trial begins at that site and must monitor the study until completed. Regulatory authorities, the IRB or the sponsor may suspend a clinical trial at any time on various grounds, including a finding that the subjects are being exposed to an unacceptable health risk or that the clinical trial is unlikely to meet its stated objectives. Some studies also include oversight by an independent group of qualified experts organized by the clinical study sponsor, known as a data safety monitoring board, or DSMB, which may review data and endpoints at designated check points, make recommendations and/or halt the clinical trial if it determines that there is an unacceptable safety risk for subjects or other grounds, such as no demonstration of efficacy. There are also requirements governing the registration of ongoing clinical studies and posting of clinical study results to public registries.
Human clinical trials are typically conducted in three sequential phases that may overlap or be combined:
Phase One : The product candidate is initially introduced into a limited number of healthy human subjects or patients with the target disease or condition. These studies are designed to test the safety, dosage tolerance, absorption, metabolism, and distribution of the investigational product in humans, the side effects associated with increasing doses, and, if possible, to gain early evidence on effectiveness. In the case of some product candidates for severe or life-threatening diseases, especially when the product candidate may be too inherently toxic to ethically administer to healthy volunteers, the initial human testing;
Phase Two : The product candidate is administered to a limited patient population with the target disease or condition to evaluate the preliminary efficacy, optimal dosages, and dosing schedule and to identify possible adverse side effects and safety risks. Multiple Phase 2 clinical trials may be conducted to obtain information prior to beginning Phase 3 trials;
Phase Three : The product candidate is administered to an expanded patient population to further evaluate dosage, to provide statistically significant evidence of clinical efficacy and to further test for safety, generally at multiple geographically dispersed clinical trial sites. These clinical trials are intended to establish the overall risk relative to potential benefit and generate the data used by FDA and other regulatory agencies to evaluate suitability for marketing authorization.
Post-approval clinical trials, sometimes referred to as Phase 4 studies, may be conducted after initial marketing approval. These clinical trials are used to gain additional experience from the treatment of patients in the intended therapeutic indication. In certain instances, the FDA may mandate the performance of Phase 4 clinical trials as a condition of approval of an NDA.
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Sponsor may voluntarily pause or stop a clinical trial, or the FDA may place a trial on full or partial clinical hold at any time on various grounds, including a finding that the research subjects or patients are being exposed to an unacceptable health risk or concerns related to chemistry, manufacturing and controls. A clinical hold is an order issued by the FDA to delay or suspend an investigation. Following the issuance of a clinical hold or a partial clinical hold, a clinical trial may only proceed after FDA has notified the sponsor that any deficiencies have been corrected and FDA is authorizing the trial to proceed. In addition, an IRB representing each institution participating in the clinical trial must review and approve the plan for any clinical trial before it commences at that institution, and the IRB must conduct continuing review and reapprove the study at least annually. The IRB must review and approve, among other things, the study protocol and informed consent information to be provided to study subjects. An IRB must operate in compliance with FDA regulations. An IRB can suspend or terminate approval of a clinical trial at its institution, or an institution it represents, if the clinical trial is not being conducted in accordance with the IRB’s requirements or if the product candidate has been associated with unexpected serious harm to patients. Finally, some clinical trials are overseen by an independent group of qualified experts organized by the sponsor, known as a data safety monitoring board or committee. Depending on its charter, this group may determine whether a clinical trial may move forward at designated check points based on access to certain data from the clinical trial.
During the development of a new drug, sponsors are given opportunities to meet with the FDA at certain points. These points may be prior to submission of an IND, at the end of Phase 2, and before an NDA is submitted. Meetings at other times may be requested by the sponsor. These meetings can provide an opportunity for the sponsor to share information about the data gathered to date, for the FDA to provide advice, and for the sponsor and the FDA to reach alignment on plans for the next phase of development. Sponsors typically use the meetings at the end of the Phase 2 clinical trials to discuss Phase 2 clinical results and present plans for the pivotal Phase 3 clinical trials that they believe will support approval of the new drug.
Concurrent with clinical trials, companies usually complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the drug candidate and finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the product candidate and, among other things, the manufacturer must develop methods for testing the identity, strength, quality, and purity of the final drug. In addition, appropriate packaging must be selected and tested, and stability studies must be conducted to demonstrate that the product candidate does not undergo unacceptable deterioration over its shelf life.
While the IND is active and before approval, progress reports summarizing the results of the clinical trials and nonclinical studies performed since the last progress report must be submitted at least annually to the FDA, and written IND safety reports must be submitted to the FDA and investigators for serious and unexpected suspected adverse events, findings from other studies suggesting a significant risk to humans exposed to the same or similar drugs, findings from animal or in vitro testing suggesting a significant risk to humans, and any clinically important increased incidence of a serious suspected adverse reaction compared to that listed in the protocol or investigator brochure.
NDA Review and Approval Process
Assuming successful completion of all required testing in accordance with all applicable regulatory requirements, the results of product development nonclinical and clinical trials, along with descriptions of the manufacturing process, analytical tests conducted on the chemistry of the drug, proposed labeling and other relevant information are submitted to the FDA as part of an NDA requesting approval to market the product candidate. The submission of an NDA is subject to the payment of substantial user fees; a waiver of such fees may be obtained under certain limited circumstances. Additionally, no user fees are assessed on NDAs for product candidates designated as orphan drugs, unless the product also includes a non-orphan indication.
The FDA reviews an NDA to determine, among other things, whether a product is safe and effective for its intended use and whether its manufacturing is cGMP-compliant to assure and preserve the product’s identity, strength, quality, and purity. Under the Prescription Drug User Fee Act, or PDUFA, guidelines that are currently in effect, the FDA has a goal of ten months from the date of “filing” of a standard NDA for a new molecular entity to review and act on the submission. This review typically takes 12 months from the date the NDA is submitted to FDA because the FDA has approximately
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two months to make a “filing” decision after the application is submitted. The FDA conducts a preliminary review of all NDAs within the first 60 days after submission, before accepting them for filing, to determine whether they are sufficiently complete to permit substantive review. The FDA may request additional information rather than accept an NDA for filing. In this event, the NDA must be resubmitted with the additional information. The resubmitted application is also subject to review before the FDA accepts it for filing.
The FDA may refer an application for a novel drug to an advisory committee. An advisory committee is a panel of independent experts, including clinicians and other scientific experts, that reviews, evaluates and provides a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.
Before approving an NDA, the FDA will typically inspect the facility or facilities where the product is manufactured. The FDA will not approve an application unless it determines that the manufacturing processes and facilities comply with cGMP and is adequate to assure consistent production of the product within required specifications. Additionally, before approving an NDA, the FDA will typically inspect one or more clinical sites to assure compliance with GCPs. If the FDA determines that the application, manufacturing process, or manufacturing facilities are not acceptable, it will outline the deficiencies in the submission and often will request additional testing or information. Notwithstanding the submission of any requested additional information, the FDA ultimately may decide that the application does not satisfy the regulatory criteria for approval.
After the FDA evaluates an NDA, it will issue an approval letter or a Complete Response Letter. An approval letter authorizes commercial marketing of the drug with prescribing information for specific indications. A Complete Response Letter indicates that the review cycle of the application is complete, and the application will not be approved in its present form. A Complete Response Letter usually describes the specific deficiencies in the NDA identified by the FDA and may require additional clinical data, such as an additional pivotal Phase 3 clinical trial or other significant and time-consuming requirements related to clinical trials, nonclinical studies, or manufacturing. If a Complete Response Letter is issued, the sponsor must resubmit the NDA, addressing all of the deficiencies identified in the letter, or withdraw the application. Even if such data and information are submitted, the FDA may decide that the NDA does not satisfy the criteria for approval.
If regulatory approval of a product is granted, such approval will be granted for particular indications and may entail limitations on the indicated uses for which such product may be marketed. For example, the FDA may approve the NDA with a REMS to ensure the benefits of the product outweigh its risks. A REMS is a safety strategy to manage a known or potential serious risk associated with and approved drug and to enable patients to have continued access to such drug by managing their safe use. It could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries, and other risk minimization tools. The FDA also may offer conditional approval subject to, among other things, changes to proposed labeling or the development of adequate controls and specifications. Once approved, the FDA may withdraw the product approval if compliance with pre- and post-marketing requirements is not maintained or if problems occur after the product reaches the marketplace. The FDA may also require one or more Phase 4 post-market studies and surveillance to further assess and monitor the product’s safety and effectiveness after commercialization, and may limit further marketing of the product based on the results of these post-marketing studies. In addition, new government requirements, including those resulting from new legislation, may be established, or the FDA’s policies may change, which could impact the timeline for regulatory approval or otherwise impact ongoing development programs.
Changes to some of the conditions established in an approved application, including changes in indications, labeling, or manufacturing processes or facilities, require submission to and FDA approval of a new NDA or NDA supplement before the change can be implemented. An NDA supplement for a new indication typically requires clinical data similar to that in the original application, and the FDA uses the same procedures and actions in reviewing NDA supplements as it does in reviewing NDAs. As with new NDAs, the review process is often significantly extended by the FDA requests for additional information or clarification.
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Expedited Development and Review Programs
The FDA has a Fast Track designation program that is intended to expedite or facilitate the process for reviewing new drug candidates that meet certain criteria. Specifically, new drug candidates are eligible for Fast Track designation if they are intended to treat a serious or life-threatening disease or condition and demonstrate the potential to address unmet medical needs for the disease or condition. Fast Track designation applies to the combination of the drug candidate and the specific indication for which it is being studied. The sponsor of a fast track designated product has opportunities for more frequent interactions with the applicable FDA review team during product development. With regard to a fast track designated product, the FDA may also consider for review sections of the NDA on a rolling basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the NDA, the FDA agrees to accept sections of the NDA and determines that the schedule is acceptable, and the sponsor pays any required user fees upon submission of the first section of the NDA.
Any drug candidate submitted to the FDA for approval, including a drug candidate with a Fast Track designation, may also be eligible for other types of FDA programs intended to expedite development and review, such as priority review and accelerated approval. A drug candidate is eligible for priority review if it has the potential to provide safe and effective therapy where no satisfactory alternative therapy exists or a significant improvement in the treatment, diagnosis, or prevention of a disease compared to marketed products. The FDA will attempt to direct additional resources to the evaluation of an application for a new drug candidate designated for priority review in an effort to facilitate the review. The FDA endeavors to review applications with priority review designations within six months of the filing date as compared to ten months for review of new molecular entity NDAs under its current PDUFA review goals.
In addition, a drug candidate may be eligible for accelerated approval. Drug candidates intended to treat serious or life-threatening diseases or conditions may be eligible for accelerated approval upon a determination that the drug candidate has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit, or on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments. As a condition of accelerated approval, the FDA generally requires that the sponsor perform adequate and well-controlled post-marketing confirmatory clinical trials which must be conducted with due diligence to verify and describe the predicted clinical benefit. Under the Food and Drug Omnibus Reform Act of 2022, or FDORA, the FDA may require, as appropriate, that such confirmatory trials be underway prior to approval or within a specific time period after the date accelerated approval is granted. Under FDORA, the FDA has increased authority for expedited procedures to withdraw approval of a drug or indication approved under accelerated approval if, for example, the sponsor fails to conduct the required confirmatory trials or if such studies fail to verify the predicted clinical benefit. In addition, the FDA currently requires, unless otherwise informed by the agency, pre-approval of promotional materials as a condition for accelerated approval, which could adversely impact the timing of the commercial launch of the product.
The Food and Drug Administration Safety and Innovation Act established a category of drugs referred to as “breakthrough therapies” that may be eligible to receive Breakthrough Therapy designation. A sponsor may seek FDA designation of a product candidate as a “Breakthrough Therapy” if the drug candidate is intended, alone or in combination with one or more other products, to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the drug candidate may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. The designation includes all of the fast track program features, as well as more intensive FDA interaction and guidance. The Breakthrough Therapy designation is a distinct status from both accelerated approval and priority review, which can also be granted to the same drug if relevant criteria are met. If a drug candidate is designated as Breakthrough Therapy, the FDA will work to expedite the development and review of such drug candidate.
Fast Track designation, priority review, accelerated approval, and Breakthrough Therapy designation do not change the standards for approval, but may expedite the development, review or approval process. Even if a drug candidate qualifies for one or more of these programs, the FDA may later decide that the drug candidate no longer meets the conditions for qualification or decide that the time period for FDA review or approval will not be shortened. We may explore some of these opportunities for our drug candidates as appropriate.
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Post-Approval Requirements
Any products manufactured or distributed by us pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including, among other things, requirements relating to record-keeping, reporting of adverse experiences, periodic reporting, product sampling and distribution, and advertising and promotion of the product. After approval, most changes to the approved product, such as adding new indications or other labeling claims, are subject to prior FDA review and approval. There are continuing, annual program fees for any marketed products. Drug manufacturers and their subcontractors are required to register their establishments with the FDA and certain state agencies, and are subject to periodic unannounced inspections by the FDA and certain state agencies for compliance with cGMP, which impose certain procedural and documentation requirements upon us and our third-party manufacturers. Changes to the manufacturing process are strictly regulated, and, depending on the significance of the change, may require prior FDA approval before being implemented. FDA regulations also require investigation and correction of any deviations from cGMP and impose reporting requirements upon us and any third-party manufacturers that we may decide to use. Accordingly, manufacturers must continue to expend time, money, and effort in the area of production and quality control to maintain compliance with cGMP and other aspects of regulatory compliance.
The FDA may withdraw approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market. Later discovery of previously unknown problems with a product, including adverse events of unanticipated severity or frequency, or with manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information; imposition of post-market studies or clinical studies to assess new safety risks; or imposition of distribution restrictions or other restrictions under a REMS program. Other potential consequences include, among other things:
● restrictions on the marketing or manufacturing of the product, complete withdrawal of the product from the market or product recalls;
● fines, warning letters, untitled letters, Form 483s;
● clinical holds on post-approval or Phase 4 clinical studies, if applicable;
● refusal of the FDA to approve pending applications or supplements to approved applications, or suspension or revocation of product license approvals;
● product seizure or detention, or refusal to permit the import or export of products;
● consent decrees, corporate integrity agreements, debarment, or exclusion from federal healthcare programs; and
● mandated modification of promotional materials and labeling and the issuance of corrective information.
Under PREA, an NDA must contain data to assess the safety and efficacy of the applicant product for indications in applicable pediatric populations. It must also contain information to support dose administration for pediatric populations where the drug may be utilized. FDA has the ability to grant complete waivers, partial waivers, or deferrals for compliance with PREA. PREA requirements may be waived for applications for approval of drug candidates intended to treat, mitigate, prevent, diagnose or cure diseases and other conditions that do not occur in pediatric populations. Generally, PREA does not apply for drug candidates which have obtained an orphan designation, unless otherwise regulated by the FDA. Despite this, separate PREA compliance or waivers may still be required for each product indication. Although noncompliance with PREA will generally not be considered for withdrawal of an approval it may be considered by the FDA as the sole basis for enforcement action such as injunction or seizure as non-compliance and may render the drug misbranded.
The FDA closely regulates the marketing, labeling, advertising, and promotion of drug products. A company can make only those claims relating to safety and efficacy that are approved by the FDA and in accordance with the provisions of the approved label. The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses. Failure to comply with these requirements can result in, among other things, adverse publicity, warning letters, corrective advertising, and potential civil and criminal penalties. Physicians may prescribe, in their independent professional medical judgment, legally available products for uses that are not described in the product’s labeling and that differ from those tested by us and approved by the FDA. Physicians may believe that such off-label uses are the best treatment for many patients in varied circumstances. The FDA does not regulate the behavior of physicians in their choice
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of treatments. The FDA does, however, restrict manufacturer’s communications on the subject of off-label use of their products. The federal government has levied large civil and criminal fines against companies for alleged improper promotion of off-label use and has enjoined companies from engaging in off-label promotion. The FDA and other regulatory agencies have also required that companies enter into consent decrees or permanent injunctions under which specified promotional conduct is changed or curtailed. However, companies may share truthful and not misleading information that is otherwise consistent with a product’s FDA-approved labelling.
From time to time, legislation is drafted, introduced, passed in Congress and signed into law that could significantly change the statutory provisions governing the approval, manufacturing, and marketing of products regulated by the FDA. In addition to new legislation, FDA regulations, guidance, and policies are often revised or reinterpreted by the agency in ways that may significantly affect the manner in which pharmaceutical products are regulated and marketed.
Patent Term Restoration and Marketing Exclusivity
Market exclusivity provisions authorized under the FDCA can delay the submission and approval of certain marketing applications for products containing the same active ingredient. The FDCA provides a five- year period of non-patent marketing exclusivity within the United States to the first applicant to obtain approval of an NDA for an NCE. A drug is an NCE if the FDA has not previously approved any other new drug containing the same active moiety, which is the molecule or ion responsible for the action of the drug substance. The FDCA also permits patent term restoration of up to five years as compensation for a patent term lost during product development and FDA regulatory review process to the first applicant to obtain approval of an NDA for an NCE in the United States. Patent-term restoration, however, cannot extend the remaining term of a patent beyond a total of 14 years from the product’s approval date. During the NCE exclusivity period, the FDA may not approve or even accept for review an ANDA or an NDA submitted under Section 505(b)(2), or a (505(b)(2) NDA), submitted by another company for another drug based on the same active moiety, regardless of whether the drug is intended for the same indication as the original innovative drug or for another indication, where the applicant does not own or have a legal right of reference to all the data required for approval. However, an application may be submitted after four years if it contains a certification of patent invalidity or non-infringement to one of the patents listed in the Orange Book, with the FDA by the innovator NDA holder. Upon approval of an NDA, each of the patents listed in the application for the drug is then published in the Orange Book. These products may be cited by potential competitors in support of approval of an ANDA or 505(b)(2) NDA. Any competitor who files an ANDA seeking approval of a generic equivalent version of a drug listed in the Orange Book or a 505(b)(2) NDA referencing a drug listed in the Orange Book must make patent certifications to the FDA that (1) no patent information on the drug or method of use that is the subject of the application has been submitted to the FDA; (2) the patent has expired; (3) the date on which the patent has expired and approval will not be sought until after the patent expiration; or (4) the patent is invalid or will not be infringed upon by the manufacture, use, or sale of the drug product for which the application is submitted. Generally, the ANDA or 505(b)(2) NDA cannot be approved until all listed patents have expired, except where the ANDA or 505(b)(2) NDA applicant challenges a listed patent through the last type of certification, also known as a paragraph IV certification. If the applicant does not challenge the listed patents or indicates that it is not seeking approval of a patented method of use, the ANDA or 505(b)(2) NDA application will not be approved until all of the listed patents claiming the referenced product have expired. If the ANDA or 505(b)(2) NDA applicant has provided a paragraph IV certification the applicant must send notice of the paragraph IV certification to the NDA and patent holders once the application has been accepted for filing by the FDA. The NDA and patent holders may then initiate a patent infringement lawsuit in response to the notice of the paragraph IV certification. If the paragraph IV certification is challenged by an NDA holder or the patent owner(s) asserts a patent challenge to the paragraph IV certification, the FDA may not approve that application until the earlier of 30 months from the receipt of the notice of the paragraph IV certification, the expiration of the patent, when the infringement case concerning each such patent was favorably decided in the applicant’s favor or settled, or such shorter or longer period as may be ordered by a court. This prohibition is generally referred to as the 30-month stay. In instances where an ANDA or 505(b)(2) NDA applicant files a paragraph IV certification, the NDA holder or patent owner(s) regularly take action to trigger the 30-month stay, recognizing that the related patent litigation may take many months or years to resolve. Thus, approval of an ANDA or 505(b)(2) NDA could be delayed for a significant period of time depending on the patent certification the applicant makes and the reference drug sponsor’s decision to initiate patent litigation. If the drug has NCE exclusivity and the ANDA is submitted four years after approval, the 30-month stay is extended so that it expires 7 1∕2 years after approval of the innovator drug, unless the patent expires or there is a decision in the infringement case that is favorable to the ANDA applicant before then.
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The FDCA alternatively provides three years of marketing exclusivity for an NDA, or supplement to an existing NDA if new clinical investigations, other than bioavailability studies, that were conducted or sponsored by the applicant are deemed by the FDA to be essential to the approval of the application, for example new indications, dosages, or strengths of an existing drug. This three-year exclusivity covers only the modification for which the drug received approval on the basis of the new clinical investigations and does not prohibit the FDA from approving ANDAs or 505(b)(2) NDAs for drugs containing the active agent for the original indication or condition of use. Five-year and three-year exclusivity will not delay the submission or approval of a full NDA. However, an applicant submitting a full NDA would be required to conduct or obtain a right of reference to any nonclinical studies and adequate and well-controlled clinical trials necessary to demonstrate safety and effectiveness.
Pediatric exclusivity is another type of marketing exclusivity available in the United States. Pediatric exclusivity provides for an additional six months of marketing exclusivity attached to another period of exclusivity if a sponsor conducts clinical trials in children in response to a written request from the FDA. The issuance of a written request does not require the sponsor to undertake the described clinical trials. The indications the Company is currently pursuing for its product candidates will not be eligible for pediatric exclusivity because they are age-related degenerative diseases and disorders that do not occur in the pediatric population. In addition, orphan drug exclusivity, as described above, may offer a seven-year period of marketing exclusivity, except in certain circumstances.
Other Healthcare Laws
Our activities are subject to various federal and state fraud and abuse laws, including, without limitation, the federal Anti-Kickback Statute, the federal civil False Claims Act, and laws and regulations pertaining to limitations on and reporting of healthcare provider payments (physician sunshine laws). These laws and regulations are interpreted and enforced by various federal, state and local authorities including CMS, the Office of Inspector General for the U.S. Department of Health and Human Services, the U.S. Department of Justice, individual U.S. Attorney offices within the Department of Justice, and state and local governments. These laws include:
● the U.S. federal Anti-Kickback Statute, which prohibits, among other things, persons or entities from knowingly and willfully soliciting, offering, receiving or paying any remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, lease, order, or arranging for or recommending the purchase, lease or order of, any good or service, for which payment may be made, in whole or in part, under federal healthcare programs such as Medicare and Medicaid. A person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;
● the U.S. civil False Claims Act (which can be enforced through “qui tam,” or whistleblower actions, by private citizens on behalf of the federal government), prohibits any person from, among other things, knowingly presenting, or causing to be presented false or fraudulent claims for payment of government funds or knowingly making, using or causing to be made or used, a false record or statement material to an obligation to pay money to the government or knowingly and improperly avoiding, decreasing or concealing an obligation to pay money to the U.S. federal government;
● U.S. federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal liability and amends provisions on the reporting, investigation, enforcement, and penalizing of civil liability for, among other things, knowingly and willfully executing, or attempting to execute, a scheme to defraud any healthcare benefit program, or knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement, in connection with the delivery of, or payment for healthcare benefits, items or services by a healthcare benefit program, which includes both government and privately funded benefits programs; similar to the U.S. federal Anti- Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;
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● state laws and regulations, including state anti-kickback and false claims laws, that may apply to our business practices, including but not limited to, research, distribution, sales and marketing arrangements and claims involving healthcare items or services reimbursed by any third-party payer, including private insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S. federal government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; and state laws and regulations that require drug manufacturers to file reports relating to pricing and marketing information, which requires tracking gifts and other remuneration and items of value provided to healthcare professionals and entities; and
● the Physician Payments Sunshine Act, implemented as the Open Payments program, and its implementing regulations, requires certain manufacturers of drugs, devices, biologics and medical supplies that are reimbursable under Medicare, Medicaid, or the Children’s Health Insurance Program to report annually to CMS information related to certain payments made in the preceding calendar year and other transfers of value provided to physicians and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members; applicable manufacturers also are required to report such information regarding payments and transfers of value provided, during the previous year to physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, and certified nurse-midwives.
Violations of any of these laws or any other governmental regulations that may apply to us, may subject us to significant civil, criminal and administrative sanctions including penalties, damages, fines, imprisonment, and exclusion from government funded healthcare programs, such as Medicare and Medicaid, and/or adverse publicity. Moreover, government entities and private litigants have asserted claims under state consumer protection statutes against pharmaceutical companies for alleged false or misleading statements in connection with the marketing, promotion and/or sale of pharmaceutical products.
Foreign Corrupt Practices Act
The Foreign Corrupt Practices Act, or the FCPA, generally prohibits offering, promising, giving, or authorizing others to give anything of value, either directly or indirectly, to a non-U.S. government official in order to influence official action, or otherwise obtain or retain business. The FCPA also requires public companies to make and keep books and records that accurately and fairly reflect the transactions of the corporation and to devise and maintain an adequate system of internal accounting controls. Our industry is heavily regulated and therefore involves significant interaction with public officials, including officials of non-U.S. governments. Additionally, in many other countries, the health care providers who prescribe pharmaceuticals are employed by their government, and the purchasers of pharmaceuticals are government entities; therefore, our dealings with these prescribers and purchasers are subject to regulation under the FCPA. Recently, the SEC and Department of Justice have increased their FCPA enforcement activities with respect to pharmaceutical companies. Violations could result in fines, criminal sanctions against us, our officers, or our employees, the closing down of our facilities, requirements to obtain export licenses, cessation of business activities in sanctioned countries, implementation of compliance programs, and prohibitions on the conduct of our business. Enforcement actions may be brought by the Department of Justice or the SEC, and recent enacted legislation has expanded the SEC’s power to seek disgorgement in all FCPA cases filed in federal court and extended the statute of limitations in SEC enforcement actions in intent-based claims such as those under the FCPA from five years to ten years.
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Coverage and Reimbursement
Sales of any pharmaceutical product depend, in part, on the extent to which such product will be covered by third-party payors, such as federal, state, and foreign government healthcare programs, commercial insurance, and managed healthcare organizations, and the level of reimbursement for such product by third-party payors. Significant uncertainty exists as to the coverage and reimbursement status of any newly approved product. Decisions regarding the extent of coverage and amount of reimbursement to be provided are made on a plan-by-plan basis. One third-party payor’s decision to cover a particular product does not ensure that other payors will also provide coverage for the product. As a result, the coverage determination process can require manufacturers to provide scientific details, information on cost-effectiveness, and clinical support for the use of a product to each payor separately. This can be a time-consuming process, with no assurance that coverage and adequate reimbursement will be applied consistently or obtained in the first instance.
In addition, third-party payors are increasingly reducing reimbursements for pharmaceutical products and related services. Third-party payors are increasingly challenging the prices charged, examining the medical necessity and reviewing the cost effectiveness of pharmaceutical products, in addition to questioning their safety and efficacy. Adoption of price controls and cost-containment measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could further limit sales of any product. Decreases in third-party reimbursement for any product or a decision by a third-party payor not to cover a product could reduce physician usage and patient demand for the product.
The U.S. government and state legislatures have continued implementing cost-containment programs, including price controls, restrictions on coverage and reimbursement and requirements for substitution of generic products. The Inflation Reduction Act of 2022, for example, contains substantial drug pricing reforms, including the establishment of a drug price negotiation program within the U.S. Department of Health and Human Services that would require manufacturers to charge a negotiated “maximum fair price” for certain selected drugs or pay an excise tax for noncompliance, the establishment of rebate payment requirements on manufacturers of certain drugs payable under Medicare Parts B and D to penalize price increases that outpace inflation, and requires manufacturers to provide discounts on Part D drugs. The Inflation Reduction Act of 2022 also caps Medicare beneficiaries’ annual out-of-pocket drug expenses. Substantial penalties can be assessed for noncompliance with the drug pricing provisions in the Inflation Reduction Act of 2022. Additional drug pricing proposals could appear in future federal legislation.
At the state level, there are also new laws and ongoing ballot initiatives that create additional pressure on drug pricing and may affect how pharmaceutical products are covered and reimbursed. A number of states have adopted or are considering various pricing actions, such as those requiring pharmaceutical manufacturers to publicly report proprietary pricing information, limit price increases or to place a maximum price ceiling or cap on certain products. Existing and proposed state pricing laws have added complexity to the pricing of pharmaceutical drug products.
In international markets, reimbursement and healthcare payment systems vary significantly by country, and many countries have instituted price ceilings on specific products and therapies. For example, the European Union provides options for its member states to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use. A member state may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market. Pharmaceutical products may face competition from lower-priced products in foreign countries that have placed price controls on pharmaceutical products and may also compete with imported foreign products. Furthermore, there is no assurance that a product will be considered medically reasonable and necessary for a specific indication, that it will be considered cost-effective by third-party payors, that an adequate level of reimbursement will be established even if coverage is available, or that the third-party payors’ reimbursement policies will not adversely affect the ability for manufacturers to sell products profitably.
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Healthcare Reform
The United States and many foreign jurisdictions have enacted or proposed legislative and regulatory changes affecting the healthcare system, including implementing cost-containment programs to limit the growth of government-paid healthcare costs, including price controls, restrictions on reimbursement and requirements for substitution of generic products for branded prescription products. In recent years, Congress has considered reductions in Medicare reimbursement levels for products administered by physicians. CMS, the agency that administers the Medicare and Medicaid programs, also has authority to revise reimbursement rates and to implement coverage restrictions for some products. Cost reduction initiatives and changes in coverage implemented through legislation or regulation could decrease utilization of and reimbursement for any approved products. While Medicare regulations apply only to drug benefits for Medicare beneficiaries, private payers often follow Medicare coverage policy and payment limitations in setting their own reimbursement rates. Therefore, any reduction in reimbursement that results from federal legislation or regulation may result in a similar reduction in payments from private payers.
The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Affordability Reconciliation Act, or collectively the Affordable Care Act substantially changed the way healthcare is financed by both governmental and private insurers, and significantly impacts the pharmaceutical industry. The Affordable Care Act is intended to broaden access to health insurance, reduce or constrain the growth of healthcare spending, enhance remedies against healthcare fraud and abuse, add new transparency requirements for healthcare and health insurance industries, impose new taxes and fees on pharmaceutical and medical device manufacturers, and impose additional health policy reforms. Among other things, the Affordable Care Act expanded manufacturers’ rebate liability under the Medicaid Drug Rebate Program by increasing the minimum Medicaid rebate for both branded and generic products, expanded the 340B program, and revised the definition of average manufacturer price, or AMP, which could increase the amount of Medicaid rebates manufacturers are required to pay to states. The legislation also extended Medicaid rebates, previously due only on fee-for-service Medicaid utilization, to include the utilization of Medicaid managed care organizations as well and created an alternative rebate formula for certain new formulations of certain existing products that is intended to increase the amount of rebates due on those products. There have been significant ongoing efforts to modify or eliminate the Affordable Care Act. The Tax Act, enacted on December 22, 2017, repealed the shared responsibility payment for individuals who fail to maintain minimum essential coverage under section 5000A of the Internal Revenue Code of 1986, as amended, or the Code, commonly referred to as the individual mandate.
Other legislative changes have been proposed and adopted since the passage of the Affordable Care Act. The Budget Control Act of 2011, among other things, created measures for spending reductions by Congress that include aggregate reductions to Medicare payments to healthcare providers of up to 2.0% per fiscal year, which remain in effect through 2031. The American Taxpayer Relief Act of 2012 further reduced Medicare payments to several types of providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years. The American Rescue Plan Act of 2021 eliminated the statutory Medicaid drug rebate cap, previously set at 100% of a drug’s average manufacturer price, for single source and innovator multiple source drugs, effective January 1, 2024. These laws and regulations may result in additional reductions in Medicare and other healthcare funding and otherwise affect the prices we may obtain for any of our product candidates for which we may obtain regulatory approval or the frequency with which any such product candidate is prescribed or used.
The Affordable Care Act has also been subject to challenges in the courts. In the most recent challenge, in June 2021, the Supreme Court ruled that the plaintiffs lacked standing to challenge the law as they had not alleged personal injury traceable to the allegedly unlawful conduct. As a result, the Supreme Court did not rule on the constitutionality of the ACA or any of its provisions.
Further changes to and under the Affordable Care Act remain possible but it is unknown what form any such changes or any law proposed to replace or revise the Affordable Care Act would take, and how or whether it may affect our business in the future. We expect that changes to the Affordable Care Act, the Medicare and Medicaid programs and changes stemming from other healthcare reform measures, especially with regard to healthcare access, financing or other legislation in individual states, could have a material adverse effect on the healthcare industry.
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At the state level, legislatures have increasingly passed legislation and implemented regulations designed to control pharmaceutical product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
We expect that additional federal, state and foreign healthcare reform measures will be adopted in the future, any of which could limit the amounts that federal and state governments will pay for healthcare products and services, which could result in limited coverage and reimbursement and reduced demand for our products, once approved, or additional pricing pressures.
Legal Proceedings
We are not currently a party to any material legal proceedings. From time to time, we may become involved in other litigation or legal proceedings relating to claims arising from the ordinary course of business.
Corporate Information
We were incorporated under the laws of the State of Delaware on August 21, 2007. Our principal corporate office is located at 2500 Westchester Avenue Purchase, NY 10577, and our telephone number is (412) 481-2210. Our website address is www.cogrx.com. Our website and the information contained on, or that can be accessed through, the website will not be deemed to be incorporated by reference in, and are not considered part of, this Annual Report on Form 10-K.
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