COGNITION THERAPEUTICS INC 10-K

Item 8. Financial Statements and Supplementary Data ​ Index to Consolidated Financial Statements As of and for the years ended December 31, 2024 and 2023 ​ ​ Page Report of Independent Registered Public Accounting Firm (PCAOB ID 42) ​ 113 Consolidated Balance Sheets as of December 31, 2024 and 2023 ​ 114 Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2024 and 2023 ​ 115 Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2024 and 2023 ​ 116 Consolidated Statements of Cash Flows for the years ended December 31, 2024 and 2023 ​ 117 Notes to Consolidated Financial Statements ​ 118 ​ ​ 112 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Cognition Therapeutics, Inc. Opinion on the Financial Statements ​ We have audited the accompanying consolidated balance sheets of Cognition Therapeutics, Inc. and subsidiary (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive loss, stockholders’ equity and cash flows for each of two years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles. ​ The Company's Ability to Continue as a Going Concern ​ The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and has stated that substantial doubt exists about the Company’s ability to continue as a going concern. Management's evaluation of the events and conditions and management’s plans regarding these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. ​ Basis for Opinion ​ These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. ​ We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. ​ Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. ​ /s/ Ernst & Young LLP We have served as the Company’s auditor since 2020. Philadelphia, Pennsylvania March 20, 2025 ​ ​ 113 Table of Contents COGNITION THERAPEUTICS, INC. CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ ​ 2024 2023 Assets ​ ​ ​ Current assets: ​ ​ ​ Cash and cash equivalents ​ $ 25,009 ​ $ 29,922 Grant receivables ​ 2,686 ​ 1,281 Prepaid expenses and other current assets ​ 1,860 ​ 3,019 Total current assets ​ 29,555 ​ 34,222 Property and equipment, net ​ 181 ​ 284 Right-of-use assets, operating leases ​ 498 ​ 657 Total assets ​ $ 30,234 ​ $ 35,163 Liabilities and Stockholders’ Equity ​ ​ Current liabilities: ​ ​ Accounts payable ​ 1,984 ​ 3,695 Accrued expenses ​ 7,620 ​ 4,055 Deferred grant income, current ​ ​ 1,066 ​ ​ 1,701 Operating lease liabilities, current ​ ​ 193 ​ ​ 174 Other current liabilities ​ 279 ​ 544 Total current liabilities ​ 11,142 ​ 10,169 Operating lease liabilities, non-current ​ 342 ​ 520 Total liabilities ​ 11,484 ​ 10,689 Commitments and contingencies (Note 7) ​ ​ Stockholders’ equity: ​ ​ Preferred stock, $ 0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding at December 31, 2024 and December 31, 2023 ​ ​ — ​ ​ — Common stock, $ 0.001 par value, 250,000,000 shares authorized; 59,854,877 and 32,165,478 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively ​ 60 ​ 32 Additional paid-in capital ​ 193,850 ​ 165,826 Accumulated deficit ​ ( 175,160 ) ​ ( 141,189 ) Accumulated other comprehensive loss ​ — ​ ( 195 ) Total stockholders’ equity ​ 18,750 ​ 24,474 Total liabilities and stockholders’ equity ​ $ 30,234 ​ $ 35,163 ​ The accompanying notes are an integral part of these consolidated financial statements. ​ 114 Table of Contents COGNITION THERAPEUTICS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (in thousands, except share and per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended ​ ​ ​ December 31, ​ ​ 2024 2023 Operating Expenses: ​ ​ ​ ​ Research and development ​ ​ $ 41,676 ​ $ 37,196 General and administrative ​ ​ 12,290 ​ 13,528 Total operating expenses ​ ​ 53,966 ​ 50,724 Loss from operations ​ ​ ( 53,966 ) ​ ( 50,724 ) Other income (expense): ​ ​ ​ ​ ​ Grant income ​ ​ 19,549 ​ 24,805 Other income, net ​ ​ 666 ​ 158 Interest expense ​ ​ ( 25 ) ​ ( 27 ) Loss on currency translation from liquidation of subsidiary ​ ​ ​ ( 195 ) ​ ​ — Total other income, net ​ ​ 19,995 ​ 24,936 Net loss ​ ​ ​ ( 33,971 ) ​ ​ ( 25,788 ) Foreign currency translation adjustment, including reclassifications ​ ​ 195 ​ 4 Total comprehensive loss ​ ​ $ ( 33,776 ) ​ $ ( 25,784 ) Net loss per share: ​ ​ ​ ​ ​ ​ ​ Basic ​ ​ $ ( 0.86 ) ​ $ ( 0.86 ) Diluted ​ ​ $ ( 0.86 ) ​ $ ( 0.86 ) Weighted-average common shares outstanding: ​ ​ ​ ​ ​ ​ ​ Basic ​ ​ ​ 39,730,148 ​ ​ 30,029,087 Diluted ​ ​ ​ 39,730,148 ​ ​ 30,029,087 ​ The accompanying notes are an integral part of these consolidated financial statements. ​ ​ ​ 115 Table of Contents COGNITION THERAPEUTICS, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (in thousands, except share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ Other ​ Total ​ Common Stock ​ Paid-in ​ Accumulated ​ Comprehensive ​ Stockholders’ ​ Shares Amount Capital Deficit Loss Equity Balances as of December 31, 2022 28,991,548 ​ $ 29 ​ $ 155,820 ​ $ ( 115,401 ) ​ $ ( 199 ) ​ $ 40,249 Issuance of common stock under the at-the-market (ATM) sales agreement, net of commissions and allocated fees 2,859,074 ​ ​ 3 ​ ​ 5,124 ​ ​ — ​ ​ — ​ 5,127 Issuance of common stock as commitment shares for equity line financing (Note 8) 189,856 ​ ​ — ​ ​ 318 ​ ​ — ​ ​ — ​ ​ 318 Issuance of common stock related to the equity line financing 125,000 ​ ​ — ​ ​ 210 ​ ​ — ​ ​ — ​ ​ 210 Equity-based compensation — ​ ​ — ​ ​ 4,354 ​ ​ — ​ ​ — ​ ​ 4,354 Other comprehensive gain — ​ ​ — ​ ​ — ​ ​ — ​ ​ 4 ​ ​ 4 Net loss — ​ ​ — ​ ​ — ​ ​ ( 25,788 ) ​ ​ — ​ ( 25,788 ) Balances as of December 31, 2023 32,165,478 ​ $ 32 ​ $ 165,826 ​ $ ( 141,189 ) ​ $ ( 195 ) ​ $ 24,474 Issuance of common stock in follow on public offering, net of discounts and issuance costs of $ 1,329 7,557,142 ​ ​ 8 ​ ​ 11,888 ​ ​ — ​ ​ — ​ 11,896 Issuance of common stock under the at-the-market sales agreement, net of commissions and allocated fees 19,913,189 ​ ​ 20 ​ ​ 12,434 ​ ​ — ​ ​ — ​ ​ 12,454 Issuance of common stock upon vesting of RSUs, net of shares withheld for employee taxes 125,718 ​ ​ — ​ ​ ( 128 ) ​ ​ — ​ ​ — ​ ​ ( 128 ) Exercise of common stock options 93,350 ​ ​ — ​ ​ 82 ​ ​ ​ ​ ​ ​ ​ ​ 82 Equity-based compensation — ​ ​ — ​ ​ 3,748 ​ ​ — ​ ​ — ​ ​ 3,748 Reclassification adjustment of foreign currency translation included in net loss for liquidation of subsidiary — ​ ​ — ​ ​ — ​ ​ — ​ ​ 195 ​ ​ 195 Net loss — ​ ​ — ​ ​ — ​ ​ ( 33,971 ) ​ ​ — ​ ( 33,971 ) Balances as of December 31, 2024 59,854,877 ​ $ 60 ​ $ 193,850 ​ $ ( 175,160 ) ​ $ — ​ $ 18,750 ​ The accompanying notes are an integral part of these consolidated financial statements. ​ ​ 116 Table of Contents COGNITION THERAPEUTICS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2024 2023 Cash flows from operating activities: ​ ​ ​ Net loss ​ $ ( 33,971 ) ​ $ ( 25,788 ) Adjustments to reconcile net loss to net cash used in operating activities: ​ ​ ​ Depreciation and amortization ​ 107 ​ 96 Equity-based compensation ​ 3,748 ​ 4,354 Amortization of right-of-use assets ​ ​ 159 ​ ​ 156 Loss on currency translation from liquidation of subsidiary ​ ​ 195 ​ ​ — Issuance of common stock as commitment shares for equity line financing ​ ​ — ​ ​ 318 Changes in operating assets and liabilities: ​ ​ ​ ​ Grant receivables ​ ( 1,405 ) ​ 2,391 Prepaid expenses and other assets ​ 1,633 ​ 1,852 Accounts payable and accrued expenses ​ 1,854 ​ 2,440 Deferred grant income and other liabilities ​ ​ ( 635 ) ​ ​ ( 1,687 ) Operating lease liabilities ​ ( 159 ) ​ ( 150 ) Net cash used in operating activities ​ ( 28,474 ) ​ ( 16,018 ) Cash flows from investing activities: ​ ​ Payments for property and equipment ​ ( 4 ) ​ ( 147 ) Net cash used in investing activities ​ ( 4 ) ​ ( 147 ) Cash flows from financing activities: ​ ​ Proceeds from issuance of common stock in follow-on public offering, net ​ ​ 11,896 ​ ​ — Proceeds from issuance of common stock under the ATM sales agreement, net ​ ​ 12,454 ​ ​ 5,127 Proceeds from the exercise of common stock options ​ ​ 82 ​ ​ — Proceeds from sale of common stock related to the equity line financing ​ ​ — ​ ​ 205 Payment of employee withholding taxes on vested restricted stock units ​ ​ ( 128 ) ​ ​ — Payments on loan payable ​ ​ ( 739 ) ​ ​ ( 811 ) Net cash provided by financing activities ​ 23,565 ​ 4,521 Effect of exchange rate changes on cash and cash equivalents ​ — ​ 4 Net decrease in cash and cash equivalents ​ ( 4,913 ) ​ ( 11,640 ) Cash and cash equivalents ​ ​ ​ ​ ​ ​ Cash and cash equivalents – beginning of period ​ 29,922 ​ 41,562 Cash and cash equivalents – end of period ​ $ 25,009 ​ $ 29,922 Supplemental disclosures of non-cash financing activities: ​ ​ Prepayment of insurance through third-party financing ​ $ 475 ​ $ 721 ​ The accompanying notes are an integral part of these consolidated financial statements. ​ ​ ​ 117 Table of Contents COGNITION THERAPEUTICS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts) 1. Description of Business and Financial Condition Cognition Therapeutics, Inc. (the “Company”) was incorporated as a Delaware corporation on August 21, 2007. The Company is a biopharmaceutical company developing disease-modifying therapies targeting age-related degenerative diseases and disorders of the central nervous system (“CNS”) and retina. The Company’s pipeline candidates were discovered using proprietary biology and chemistry platforms designed to identify novel drug targets and disease-modifying therapies that address dysregulated pathways specifically associated with neurodegenerative diseases. The Company was founded on the unique combination of biological expertise around these targets, including proprietary assays that emphasize functional responses, and proprietary medicinal chemistry intended to produce novel, high-quality small-molecule drug candidates. In January 2024, the Company ceased operations at Cognition Therapeutics PTY LTD, a wholly owned subsidiary (the “Subsidiary”) and completed its liquidation of the Subsidiary (the “Liquidation”). In accordance with the Liquidation, the Company removed the Accumulated Other Comprehensive Income (AOCI) balance associated with the currency translation adjustments and recorded a loss on liquidation of the Subsidiary in accumulated deficit. On December 23, 2022, the Company filed a Registration Statement on Form S-3 (File No. 333-268992) (the “Shelf”) with the Securities and Exchange Commission (“SEC”) in relation to the registration of common stock, preferred stock, debt securities, warrants, subscription rights, and/or units of any combination thereof of up to $ 200,000 in aggregate. The Shelf was declared effective on January 3, 2023 by the SEC. The Company also simultaneously entered into a sales agreement with Cantor Fitzgerald & Co. and B. Riley Securities, Inc. (the “Sales Agents”) providing for the offering, issuance and sale by the Company of up to $ 40,000 of its common stock from time to time in “at-the-market” offerings under the Shelf (the “ATM”). During the year ended December 31, 2024, the Company sold 19,913,189 shares of its common stock pursuant to the ATM for net proceeds of approximately $ 12,454 . Please refer to Note 8 for further details. ​ On March 10, 2023, the Company entered into a purchase agreement with Lincoln Park Capital Fund, LLC (“Lincoln Park”) for an equity line financing (the “Purchase Agreement”). The Purchase Agreement provides that, subject to the terms and conditions set forth therein, the Company has the right, but not the obligation, to direct Lincoln Park to purchase up to $ 35,000 of shares of common stock in the Company’s sole discretion, over a 36-month period commencing on March 10, 2023. The Company filed a prospectus supplement to its Registration Statement on Form S-3 (File No. 333-268992) covering the resale of shares of common stock that may be issued under the Purchase Agreement. As part of the Purchase Agreement, the Company issued 189,856 shares of its common stock as consideration for Lincoln Park’s commitment to purchase shares of common stock under the Purchase Agreement. During the year ended December 31, 2024, the Company did not sell any shares of common stock to Lincoln Park. As of December 31, 2024, $ 34,795 was available to draw pursuant to the Purchase Agreement. Please refer to Note 8 for further details. ​ On March 14, 2024, the Company closed a follow-on public offering of 6,571,428 shares of the Company’s common stock at a public offering price of $ 1.75 per share (“March 2024 Offering”). As part of the March 2024 Offering, the underwriters exercised their option to purchase 985,714 shares of the Company’s common stock on March 28, 2024, at a public offering price of $ 1.75 per share. The gross proceeds from the March 2024 Offering were $ 13,225 and the net proceeds were approximately $ 11,896 , after deducting underwriting discounts and commissions and other offering related expenses payable by the Company. ​ 118 Table of Contents Liquidity and Going Concern ​ The Company’s Consolidated Financial Statements have been prepared on a going concern basis, which contemplates the continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business. The Company has incurred recurring losses since inception, including net losses of $ 33,971 for the year ended December 31, 2024 and $ 25,788 for the year ended December 31, 2023. As of December 31, 2024 and 2023, the Company had cash and cash equivalents of $ 25,009 and $ 29,922 , respectively. The Company has incurred losses and negative cash flows from operations and had an accumulated deficit of $ 175,160 as of December 31, 2024. The Company expects to continue to incur losses for the foreseeable future. As of March 20, 2025, the date of issuance of these Consolidated Financial Statements, the Company believes that its cash and cash equivalents as of December 31, 2024, is not sufficient to fund operations for the period through one year after the date of this filing and therefore substantial doubt exists about the Company’s ability to continue as a going concern. To execute its business plans, the Company will need substantial funding to support its continuing operations and pursue its growth strategy. Until such time that the Company can generate significant revenue from product sales, if ever, the Company expects to finance its operations through the sale of common stock in public offerings and/or private placements, debt financings or other capital sources, including collaborations with other companies or other strategic transactions. The terms of any financing may adversely affect the holdings or the rights of the Company’s stockholders. If the Company is unable to obtain funding, the Company could be forced to delay, reduce or abandon its product development programs, which could have a material adverse effect on its business prospects. ​ 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of the expenses during the reporting periods. Significant estimates and assumptions reflected in these consolidated financial statements include but are not limited to the valuation of stock-based awards and the valuation allowance of deferred tax assets. In addition, management’s assessment of the Company’s ability to continue as a going concern involves the estimation of the amount and timing of future cash inflows and outflows. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents consist primarily of interest-bearing deposits at various financial institutions and money markets. The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. 119 Table of Contents Grant Receivables Grant receivables relate to outstanding amounts due for reimbursable expenditures of awarded grants issued by the National Institute of Aging (“NIA”) a division of the National Institute of Health (“NIH”) and are carried at their estimated collectible amounts. The Company expects all receivables to be collectible, and accordingly, there is no allowance for doubtful accounts required on these grant receivables. Grant Income The Company generates grant income through grants from government and other (non-government) organizations. Grant income is recognized in other income (expense) in the period in which the reimbursable research and development services are incurred and the right to payment is realized. Deferred grant income represents grant proceeds received by the Company prior to the period in which the reimbursable research and development services are incurred. For the year ended December 31, 2024 and 2023, the Company generated grant income of $ 19,549 and $ 24,805 , respectively, primarily from reimbursements from the NIA for aging research. For the year ended December 31, 2024 and 2023, deferred grant income was $ 1,066 and $ 1,701 , respectively. The grants awarded relate to agreed-upon direct and indirect costs for specific studies or clinical trials, which may include personnel and consulting costs, costs paid to contract research organizations (“CROs”), research institutions and/or consortiums involved in the grants, as well as facilities and administrative costs. These grants are cost plus fixed fee arrangements in which the Company is reimbursed for its 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 NIH grants do not contain payback provisions, the NIH or other government agency may review the Company’s performance, cost structures and compliance with applicable laws, regulations, policies and standards and the terms and conditions of the applicable NIH grant. If any of the expenditures are found to be unallowable or allocated improperly or if the Company has otherwise violated terms of such NIH grant, the expenditures may not be reimbursed and/or the Company may be required to repay funds already disbursed. To date, the Company has not been found to have breached the terms of any NIH grant. As of December 31, 2024, the Company has been awarded grants with project periods that extend through May 31, 2027, subject to extension. Deferred Offering Costs The Company capitalizes certain legal, professional, accounting and other third-party fees that are directly associated with in-process equity financings as deferred offering costs until such financings are consummated. After consummation of an equity financing, these costs are recorded in stockholders’ equity as a reduction of additional paid-in capital generated as a result of the financings. Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed on the straight-line basis over the estimated useful life of the asset. The Company estimates the useful life to be 5 and 6 years for equipment and furniture and fixtures, respectively. The cost of repairs and maintenance is charged to expense as incurred. Equipment finance leases are included in Property and Equipment, net and other liabilities on the consolidated balance sheet. The Company reviews the recorded values of property and equipment for impairment whenever events or changes in business circumstances indicate that the carrying amount of an asset or group of assets may not be fully recoverable. There were no indicators of impairment of long-lived assets during the years ended December 31, 2024 or 2023. 120 Table of Contents Research and Development Costs The Company is involved in research and development of treatments for a variety of diseases related to the central nervous system, with a focus on Alzheimer’s disease, dementia with Lewy bodies, and geographic atrophy (GA) secondary to dry age-related macular degeneration. Research and development costs are expensed as incurred. Research and development expenses consist principally of personnel costs, including salaries, stock-based compensation, and benefits for employees, third-party license fees and other operational costs related to our research and development activities, including allocated facility-related expenses and external costs of outside vendors, and other direct and indirect costs. Non-refundable research and development costs are deferred and expensed as the related goods are delivered or services are performed. Costs for external development activities are recognized based on an evaluation of the progress to completion of specific tasks. Costs for certain research and development activities are recognized based on the pattern of performance of the individual arrangements, which may differ from the pattern of billings incurred, and are reflected in the consolidated financial statements as prepaid expenses or as accrued research and development expenses. Leases Under ASC 842, Leases (“ASC 842”), the Company determines if an arrangement is a lease at its inception. Leases are classified as either operating or finance, based on the Company’s evaluation of certain criteria. If a lease has a term greater than one year, the lease is recognized in the balance sheet as a right-of-use asset and a lease liability at lease commencement. The Company elected the short-term lease practical expedient, therefore, if a lease has a term less than one year, the Company will not recognize the lease on its balance sheet. The right-of-use asset represents the Company’s right of use to an underlying asset for the term of the lease and the lease liability represents the Company’s obligation to make lease payments arising from the lease. If the Company’s leases do not provide an implicit rate within the lease, the Company uses its incremental borrowing rate, based on information available at the commencement date of the lease to determine the present value of the lease payments. Operating lease right-of-use assets and operating lease liabilities are determined and recognized on the commencement date of the lease based on the present value of lease payments over the term of the lease. For operating leases, rent expense is recognized on a straight-line basis over the term of the lease, and right-of-use assets are subsequently re-measured to reflect the effect of uneven lease payments. For finance leases, right-of-use assets are amortized on a straight-line basis over the shorter of the lease term or the useful life of the underlying asset. Expenses for finance leases include the amortization of right-of-use assets, which is recorded as depreciation and amortization expense, and interest expense, which reflects interest accrued on the lease liability. Income Taxes The Company accounts for income taxes under the asset and liability method pursuant to authoritative guidance. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under this authoritative guidance, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. If it is more likely than not that some portion or all of a deferred tax asset will not be recognized, a valuation allowance is recognized. The Company accounts for uncertainty in income taxes using a recognition threshold of more-likely-than-not to be sustained upon examination by the appropriate taxing authority. Measurement of the uncertainty occurs if the recognition threshold is met. The Company has determined that there were no uncertainties as of December 31, 2024 and 2023 that met the recognition threshold. 121 Table of Contents Equity-based Compensation Following the provisions of ASC 718, Compensation — Stock Compensation , the Company recognizes compensation expense for equity-based grants using the straight-line attribution method, in which the expense is recognized ratably over the requisite service period within operating expenses based on the grant date fair value. The Company also has granted awards subject to performance-based vesting. The Company would recognize compensation expense for these awards commencing in the period in which the vesting condition becomes probable of achievement. Grant date fair value is estimated on the date of grant using the Black-Scholes option pricing model. Forfeitures are recognized in the period in which they occur. Black-Scholes requires inputs based on certain subjective assumptions, including (i) the expected stock price volatility, (ii) the expected term of the award, (iii) the risk-free interest rate and (iv) expected dividends. Due to a lack of sufficient public market data for the Company’s common stock and lack of company-specific historical and implied volatility data, the Company has based its computation of expected volatility on the historical volatility of a representative group of public companies with similar characteristics to the Company, including stage of product development and life science industry focus. The historical volatility is calculated based on a period of time commensurate with expected term assumption. The Company uses the simplified method to calculate the expected term for stock options granted to employees whereby the expected term equals the arithmetic average of the vesting term and the original contractual term of the stock options due to its lack of sufficient historical data. The risk-free interest rate is based on U.S. Treasury securities with a maturity date commensurate with the expected term of the associated award. The expected dividend yield is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock. Refer to note 9 for additional information. Concentration of Credit Risk The Company’s financial instruments that are exposed to credit risks consist of cash and cash equivalents. The Company maintains its cash and cash equivalents in bank deposit accounts which, at times, may exceed the federally insured limit. The Company has not experienced any losses in these accounts and does not believe it is exposed to any significant credit risk related to these funds. Fair Value of Financial Instruments The Company applies ASC 820, Fair Value Measurement (“ASC 820”), which establishes a framework for measuring fair value and clarifies the definition of fair value within that framework. ASC 820 defines fair value as an exit price, which is the price that would be received for an asset or paid to transfer a liability in the Company’s principal or most advantageous market in an orderly transaction between market participants on the measurement date. The fair value hierarchy established in ASC 820 generally requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs reflect the assumptions that market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the entity’s own assumptions based on market data and the entity’s judgments about the assumptions that market participants would use in pricing the asset or liability and are to be developed based on the best information available in the circumstances. The carrying value of the Company’s cash and cash equivalents, grants receivable, prepaid expense, other receivables, other assets, accounts payable, accrued expenses and other liabilities approximate fair value because of the short-term maturity of these financial instruments. The valuation hierarchy is composed of three levels. The classification within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The levels within the valuation hierarchy are described below: ● Level 1 — Assets and liabilities with unadjusted, quoted prices listed on active market exchanges. Inputs to the fair value measurement are observable inputs, such as quoted prices in active markets for identical assets or liabilities. 122 Table of Contents ● Level 2 — Inputs to the fair value measurement are determined using prices for recently traded assets and liabilities with similar underlying terms, as well as direct or indirect observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals. ● Level 3 — Inputs to the fair value measurement are unobservable inputs, such as estimates, assumptions, and valuation techniques when little or no market data exists for the assets or liabilities. Other Comprehensive Gain The Company recorded $ 0 and $ 4 in other comprehensive gain related to foreign currency translation for the years ended December 31, 2024 and 2023, respectively. The Company presents comprehensive gain and loss in a single statement within its consolidated financial statements. Net Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during each period. Diluted net loss per share includes the effect, if any, from the potential exercise or vesting of securities, such stock options and restricted stock units, which would result in the issuance of incremental shares of common stock. For diluted net loss per share, the weighted-average number of shares of common stock is the same for basic net loss per share due to the fact that when a net loss exists, dilutive securities are not included in the calculation as the impact is anti-dilutive. Segments The Company has determined that it operates and manages one operating segment, which is the business of development of clinical and preclinical product candidates for neurodegenerative disorders, such as AD and DLB. The Company’s chief operating decision maker, its chief executive officer, reviews financial information on an aggregate basis for the purpose of allocating resources. Refer to Note 13 – Segment Reporting for more information. Emerging Growth Company Status The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it is (a) no longer an emerging growth company or (b) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, these financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates. Recent Accounting Pronouncements Adopted In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which enhances segment disclosures and requires additional disclosures of segment expenses. This ASU is effective for annual periods in fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024. We adopted this ASU for the annual period ended December 31, 2024 and the amendments have been applied retrospectively to all prior periods presented in the financial statements by expanding the disclosure of expenses included in our segment measures of profitability. Refer to Note 13 - Segment Reporting for more information. 123 Table of Contents Not Yet Adopted In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements (“ASU 2023-06”), to clarify or improve disclosure and presentation requirements of a variety of topics and align the requirements in the FASB ASC with the SEC's regulations. The amendments apply to all reporting entities within the scope of the affected topics unless otherwise indicated. The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The Company is currently evaluating ASU 2023-06 to determine its impact on the Company's consolidated financial statements and disclosures. In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”). The standard enhances transparency in income tax disclosures by requiring, on an annual basis, certain disaggregated information about a reporting entity’s effective tax rate reconciliation and income taxes paid. The ASU also requires disaggregated disclosure related to pre-tax income (or loss) and income tax expense (or benefit) and eliminates certain disclosures related to the balance of an entity’s unrecognized tax benefit and the cumulative amount of certain temporary differences. The ASU is effective for the Company beginning on January 1, 2025. The Company is currently evaluating ASU 2023-09 to determine its impact on the Company's disclosures. 3. Financial Instruments and Fair Value Measurements Financial assets and liabilities measured at fair value are summarized below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, 2024 ​ ​ ​ ​ ​ ​ ​ ​ Significant ​ ​ ​ ​ ​ Quoted Priced in ​ Significant Other ​ Unobservable ​ ​ ​ ​ ​ Active Markets ​ Observable Inputs ​ Inputs ​ ​ ​ ​ (Level 1) (Level 2) (Level 3) Total Assets: ​ ​ ​ ​ Money market funds ​ $ 23,999 ​ $ — ​ $ — ​ $ 23,999 Total assets ​ $ 23,999 ​ $ — ​ $ — ​ $ 23,999 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ Significant ​ ​ ​ ​ ​ Quoted Priced in ​ Significant Other ​ Unobservable ​ ​ ​ ​ ​ Active Markets ​ Observable Inputs ​ Inputs ​ ​ ​ ​ (Level 1) (Level 2) (Level 3) Total Assets: ​ ​ ​ ​ Money market funds ​ $ 29,391 ​ $ — ​ $ — ​ $ 29,391 Total assets ​ $ 29,391 ​ $ — ​ $ — ​ $ 29,391 ​ There were no Level 3 financial instruments during the year ended December 31, 2024 and 2023. ​ 4. Property and Equipment Property and equipment, net, consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ 2024 2023 Equipment ​ $ 1,197 ​ $ 1,193 Furniture and fixtures ​ 140 ​ 140 ​ ​ $ 1,337 ​ $ 1,333 Less: Accumulated depreciation ​ ( 1,156 ) ​ ( 1,049 ) Property and equipment, net ​ $ 181 ​ $ 284 ​ Depreciation expense for the years ended December 31, 2024 and 2023 was $ 107 and $ 96 , respectively. ​ 124 Table of Contents 5. Accrued Expenses Accrued expense consists of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ ​ 2024 2023 Employee compensation, benefits, and related accruals ​ $ 1,526 ​ $ 1,165 Research and development costs ​ 5,654 ​ 2,520 Professional fees and other accruals ​ 440 ​ 370 Total ​ $ 7,620 ​ $ 4,055 ​ ​ ​ 6. Other Current Liabilities In October 2023, the Company entered into an insurance premium financing agreement with a lender. Under the agreement, the Company financed $ 721 of certain premiums at a 8.65 % annual interest rate. Total payments of approximately $ 62 , including interest and principal, are due monthly from November 2023 through October 2024. As of December 31, 2023, the outstanding principal of the loan was $ 544 and the amount was paid off in 2024 . In October 2024, the Company entered into an insurance premium financing agreement with a lender. Under the agreement, the Company financed $ 356 of certain premiums at a 8.65 % annual interest rate. Total payments of approximately $ 41 , including interest and principal, are due monthly from November 2024 through July 2025. As of December 31, 2024, the outstanding principal of the loan was $ 279 . ​ ​ 7. Commitments and Contingencies Operating Leases The Company’s principal executive offices are located in Purchase, New York where we currently occupy 2,864 square feet of office space under a lease that expires in May of 2029. The Company also leases approximately 6,068 square feet of laboratory and office space located in Pittsburgh, Pennsylvania under leases that expire in June of 2026. On August 31, 2022, the Company entered into a lease agreement for approximately 2,980 square feet of office space located in Pittsburgh, Pennsylvania. The lease has a term of 45 months and commenced on October 1, 2022. Additionally, on August 31, 2022, the Company and Landlord modified one of its existing lease agreements for approximately 3,706 square feet of lab space at the same location to extend the lease term termination date from June 30, 2023 until June 30, 2026. Amounts reported in the consolidated balance sheets for leases where the Company is the lessee as of December 31, 2024 and 2023 were as follows, in thousands: ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ 2024 ​ 2023 Assets ​ ​ ​ ​ ​ Operating lease assets $ 498 ​ $ 657 Total operating lease assets $ 498 ​ $ 657 Liabilities ​ ​ ​ ​ ​ Current ​ ​ ​ ​ ​ Operating lease liabilities $ 193 ​ $ 174 Noncurrent ​ ​ ​ ​ ​ Operating lease liabilities, net of current ​ 342 ​ ​ 520 Total operating lease liabilities $ 535 ​ $ 694 ​ 125 Table of Contents Operating lease costs for the year ended December 31, 2024 and 2023 was $ 218 and $ 215 , respectively. The maturities of the operating lease liabilities and minimum lease payments as of December 31, 2024 were as follows: ​ ​ ​ ​ For the Years Ended December 31, Operating Leases 2025 ​ $ 226 2026 ​ 158 2027 ​ 90 2028 ​ ​ 92 2029 ​ ​ 39 Thereafter ​ ​ — Total undiscounted lease payments ​ $ 605 Less: Imputed interest ​ ​ ( 70 ) Present value of operating lease liabilities ​ $ 535 ​ The following table summarizes the lease term and discount rate as of December 31, 2024 and 2023: ​ ​ ​ ​ ​ As of December 31, ​ 2024 ​ 2023 Weighted-average remaining lease term (years) ​ ​ ​ Operating leases 3.3 ​ 4.1 Weighted-average discount rate ​ ​ ​ Operating leases 8.1 % ​ 8.1 % ​ Operating cash flows used for operating leases for the year ended December 31, 2024 and 2023 was $ 224 and $ 209 , respectively. Litigation and Contingencies From time to time, the Company may be involved in disputes or regulatory inquiries that arise in the ordinary course of business. When the Company determines that a loss is both probable and reasonably estimable, a liability is recorded and disclosed if the amount is material to the financial statements taken as a whole. When a material loss contingency is only reasonably possible, the Company does not record a liability, but instead discloses the nature and the amount of the claim, and an estimate of the loss or range of loss, if such an estimate can reasonably be made. As of December 31, 2024 and 2023, there was no litigation or contingency with at least a reasonable possibility of a material loss. ​ 8. Stockholders’ Equity Common and Preferred Stock The Company is authorized to issue up to 250,000,000 shares of common stock with a par value of $ 0.001 per share, and 10,000,000 shares of preferred stock with a par value of $ 0.001 per share. As of December 31, 2024 and 2023, there were 59,854,877 and 32,165,478 shares of common stock issued and outstanding , respectively. Common stockholders are entitled to dividends if and when declared by the Company’s board of directors subject to the rights of the preferred stockholders. As of December 31, 2024, no dividends on common stock had been declared by the Company. 126 Table of Contents ATM ​ On December 23, 2022, the Company filed a shelf registration statement on Form S-3 with the SEC in relation to the registration of common stock, preferred stock, debt securities, warrants, subscription rights, and/or units of any combination thereof of up to $ 200,000 in aggregate (the “Shelf”). The Shelf was declared effective on January 3, 2023 by the SEC. The Company also simultaneously entered into a sales agreement with the Sales Agents providing for the offering, issuance and sale by the Company of up to $ 40,000 of its common stock from time to time in ATM offerings under the Shelf. The Company sold 19,913,189 shares of common stock pursuant to the ATM during the year ended December 31, 2024 for gross proceeds of approximately $ 12,840 . As of December 31, 2024, there was $ 21,874 remaining of common stock available for sale under the ATM, subject to the limitations of General Instruction I.B.6 of Form S-3. ​ Lincoln Park Purchase Agreement ​ On March 10, 2023, the Company entered into a purchase agreement with Lincoln Park for an equity line financing. The Purchase Agreement provides that, subject to the terms and conditions set forth therein, the Company has the right, but not the obligation, to direct Lincoln Park to purchase up to $ 35,000 of shares of common stock in the Company’s sole discretion, over a 36-month period commencing on March 10, 2023. As part of the Purchase Agreement, the Company issued 189,856 shares of its common stock as consideration for Lincoln Park’s commitment to purchase shares of common stock under the Purchase Agreement (the “Commitment Shares”). The Company recorded $ 318 to other expense, net during the year ended December 31, 2023 in connection with the issuance of the Commitment Shares. During the year ended December 31, 2023, the Company sold 125,000 shares of common stock to Lincoln Park for proceeds of $ 205 , as part of the equity line financing arrangement. During the year ended December 31, 2024, the Company did not sell any shares of common stock to Lincoln Park. As of December 31, 2024, $ 34,795 was available to draw pursuant to the Purchase Agreement. ​ March 2024 Offering ​ In March 2024, the Company entered into an underwriting agreement with Titan Partners Group LLC, a division of American Capital Partners, LLC, relating to the issuance and sale by the Company of 7,557,142 shares of its common stock, which included the exercise of the underwriters’ option to purchase 985,714 additional shares of common stock, at a public offering price of $ 1.75 per share. The Company closed this offering on March 14, 2024 and the full exercise of the underwriters’ option to purchase 985,714 additional shares of common stock was closed on March 28, 2024. The Company received net proceeds of approximately $ 11,896 , after deducting $ 1,329 of underwriting discounts and commissions and other offering related expenses payable by the Company. ​ ​ ​ ​ ​ 9. Equity-based Compensation 2021 Equity Incentive Plan On October 7, 2021, the date upon which the Company’s Registration Statement on Form S-1 in connection with the IPO was declared effective, the Company’s 2021 Equity Incentive Plan (the “2021 Plan”) became effective. On the same date, the Company ceased granting awards under its 2017 Equity Incentive Plan (the “2017 Plan”). The 2021 Plan authorizes the award of both equity-based and cash-based incentive awards, including: (i) stock options (both incentive stock options and nonqualified stock options), (ii) stock appreciation rights, (iii) restricted stock awards, (iv) restricted stock units, or RSUs, and (v) cash or other stock-based awards. Incentive stock options may be granted only to employees. All other types of awards may be issued to employees, directors, consultants, and other service providers. 127 Table of Contents As of December 31, 2024, the aggregate number of shares of common stock of the Company that may be issued under the Plan is 2,587,917 . The number of shares reserved for issuance under the 2021 Plan increased automatically on January 1, 2024 pursuant to an evergreen provision therein by 643,309 shares, representing 2 % of total common shares outstanding at December 31, 2023. The aggregate number of shares will increase each anniversary of such date prior to the termination of the 2021 Plan, equal to the lesser of (i) 5 % of the Company’s shares of common stock issued and outstanding on the last day of the immediately preceding fiscal year and (ii) such smaller number of shares as determined by the Company’s board of directors or the compensation committee. No more than 7,543,185 shares of common stock may be issued under the 2021 Plan through incentive stock options. Shares subject to the 2021 Plan, the 2017 Plan or the 2007 Equity Incentive Plan (the “2007 Plan” and collectively with the 2017 Plan, the “Prior Plans”) that expire, terminate or are cancelled or forfeited for any reason after the effectiveness of the 2021 Plan will be added (or added back) to the shares available for issuance under the 2021 Plan. The total number of shares underlying the Prior Plan awards that may be recycled into the 2021 Plan will not exceed 4,334,131 shares. 2017 Equity Incentive Plan On September 15, 2017, the Company’s board of directors approved the 2017 Plan, which provides for the granting of incentive stock options, non-qualified stock options and stock awards to employees, certain consultants and directors. The Board, or its designated committee, has the sole authority to select the individuals to whom awards are granted and determine the terms of each award, including the number of shares and the schedule upon which the award becomes exercisable. Upon the effectiveness of the 2021 Plan, no further awards will be granted under the 2017 Plan. The aggregate number of shares of common stock of the Company that may be issued under the 2017 Plan is 4,334,131 (taking into account shares of common stock that may become issuable pursuant to Section 3(b) of the 2017 Plan in respect of shares of common stock reserved under the Company’s Amended and Restated 2007 Equity Incentive Plan). The 2021 Plan allows for a provision for shares granted under the Prior Plans which are cancelled, forfeited, exchanged or surrendered without having been exercised to subsequently be available for reissuance under the 2021 Plan. Employee Stock Purchase Plan The Company’s board of directors approved the Employee Stock Purchase Plan, or ESPP, prior to the closing of the IPO. Under the ESPP, the Company may provide employees and employees of the Subsidiary with an opportunity to purchase shares of the Company’s common stock at a discounted purchase price. As of December 31, 2024, a total of 209,532 shares of common stock was authorized and reserved for issuance under the ESPP. Subject to prior approval by the board of directors in each instance, on or about January 1, 2022 and each anniversary of such date thereafter prior to the termination of the ESPP, the number of shares of common stock authorized and reserved for issuance under the ESPP will be increased by a number of shares of common stock equal to the least of (i) 1,000,000 shares of our common stock, (ii) 1 % of the shares of common stock outstanding on the final day of the immediately preceding calendar year, and (iii) such smaller number of shares of common stock as determined by the board of directors. Such shares of common stock may be newly issued shares, treasury shares or shares acquired on the open market. In the event that any dividend or other distribution (whether in the form of cash, our common stock, or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, or exchange of common stock or other securities, or other change in the structure affecting common stock occurs, then in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the ESPP, the compensation committee will, in such manner as it deems equitable, adjust the number of shares and class of common stock that may be delivered under the ESPP, the purchase price per share and the number of shares covered by each outstanding option under the ESPP, and the numerical limits described above. 128 Table of Contents Stock Options The fair value of options granted was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions: ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 2023 Expected volatility ​ 91.78 % –  92.29 % ​ 91.47 % –  92.68 % Risk-free interest rate ​ 4.23 % –  4.45 % ​ 3.46 % –  4.71 % Dividend yield ​ 0.00 % ​ 0.00 % Expected term (years) ​ 6.08 – 6.20 ​ 6.18  –  6.37 ​ Expected Term  — The expected term represents the period that the stock-based awards are expected to be outstanding. As the Company does not have sufficient historical experience for determining the expected term of the stock option awards granted, expected term has been calculated using the simplified method. Risk-Free Interest Rate  — The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the date of grant for zero-coupon U.S. Treasury constant maturity notes with terms approximately equal to the stock-based awards’ expected term. Expected Volatility  — Up until October 13, 2021, the Company was privately held and did not have a trading history of common stock. As such, the expected volatility was derived from the average historical stock volatilities of the common stock of several public companies within the industry that the Company considers to be comparable to our business over a period equivalent to the expected term of the stock-based awards. The Company will continue to derive expected volatility from average historical stock volatilities of industry peers until the Company has compiled a trading history of its own for a sufficient period of time. Dividend Yield  — The expected dividend yield is zero as the Company has not paid and does not anticipate paying any dividends in the foreseeable future. Activity for options was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Options Outstanding ​ ​ ​ ​ ​ ​ ​ ​ Weighted-Average ​ ​ ​ ​ ​ ​ Aggregate ​ Remaining ​ ​ Number of ​ Weighted-Average ​ Intrinsic Value ​ Contractual Life ​ Options Exercise Price (in 000’s) (In Years) Balance, December 31, 2023 4,213,405 ​ $ 4.73 $ 1,579 ​ 6.5 Options granted 247,500 ​ $ 1.97 ​ ​ ​ ​ ​ Options exercised ( 93,350 ) ​ $ 0.88 ​ ​ ​ ​ ​ Options forfeited ( 12,815 ) ​ $ 2.09 ​ ​ ​ ​ ​ Options expired ( 1,250 ) ​ $ 2.66 ​ ​ ​ ​ ​ Balance, December 31, 2024 4,353,490 ​ $ 4.67 ​ $ — ​ 5.8 Exercisable as of December 31, 2024 3,688,126 ​ $ 5.04 ​ $ — ​ 5.3 ​ The weighted-average grant date fair value of stock options granted was $ 1.56 and $ 1.56 during the years ended December 31, 2024 and 2023, respectively. There were 247,500 stock options granted at an aggregate fair value of $ 385 for the year ended December 31, 2024 and 628,769 stock options granted at an aggregate fair value of $ 983 for the year ended December 31, 2023. During the year ended December 31, 2024 and 2023, there were 93,350 and 0 stock options 129 Table of Contents exercised, respectively, with an aggregate grant date fair value of $ 58 and $ 0 , respectively. The intrinsic value of stock options exercised during the year ended December 31, 2024 and 2023 was $ 121 and $ 0 , respectively. Restricted Stock Units The fair values of RSUs are based on the fair market value of the Company’s common stock on the date of grant. Each RSU represents a contingent right to receive one share of the Company’s common stock upon vesting. RSUs with time base vesting conditions for employees vest annually over three or four years on each anniversary of the Grant Date and RSUs for non-employee directors vest on the one-year anniversary of the Grant Date. RSUs with performance conditions for employee’s vest on the one-year anniversary of the performance achievement date, assuming continued service from the employee during that period of time. For the year ended December 31, 2024 and 2023, the Company granted 358,200 and 542,419 RSUs awards, respectively, containing time based vesting conditions to employees and non-employee directors. For the year ended December 31, 2024 and 2023, the Company granted 515,600 and 0 RSUs awards, respectively, containing performance based vesting conditions to employees. During the year ended December 31, 2024, the performance conditions were achieved and RSUs will vest on the one-year anniversary of the achievement of the performance condition. As of December 31, 2024, the Company had no outstanding performance condition. The following table summarizes the Company’s RSU activity for the year ended December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ Number of ​ Weighted-Average ​ ​ Restricted Stock Units ​ Grant Date Fair Value Outstanding at December 31, 2023 ​ 522,155 ​ $ 2.07 Granted ​ 873,800 ​ $ 1.97 Vested ​ ( 183,482 ) ​ $ 2.17 Forfeited ​ ( 39,509 ) ​ $ 1.89 Outstanding at December 31, 2024 ​ 1,172,964 ​ $ 1.98 ​ Equity-based Compensation Expense The Company recorded total equity-based compensation expense in the statement of operations and comprehensive loss related to stock options and restricted stock units as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 2023 Research and development ​ ​ $ 1,080 ​ $ 670 General and administrative ​ ​ 2,668 ​ 3,684 Total equity-based compensation ​ ​ $ 3,748 ​ $ 4,354 ​ As of December 31, 2024, total future compensation expense related to unvested time-based awards yet to be recognized by the Company was $ 2,055 , which is expected to be recognized over a weighted-average remaining vesting period of approximately 1.9 years. As of December 31, 2024, total future compensation expense related to unvested performance-based awards yet to be recognized by the Company was $ 462 , which is expected to be recognized over a weighted-average remaining vesting period of approximately 0.8 years. 130 Table of Contents 10. Net Loss per Share The following outstanding potentially dilutive common stock equivalents have been excluded from the calculation of diluted net loss per share for the periods presented due to their antidilutive effect: ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ 2024 2023 Options issued and outstanding 4,353,490 4,213,405 Restricted stock units issued and outstanding ​ 1,172,964 ​ 522,155 Total 5,526,454 4,735,560 ​ ​ 11. Retirement Plan The Company maintains a 401(k) retirement plan to provide retirement and incidental benefits for its employees. Employees may contribute a percentage of their annual compensation to the 401(k) retirement plan, limited to a maximum annual amount as set periodically by the Internal Revenue Service. The Company matches employee contributions dollar for dollar up to a maximum of 6 % of the employees’ compensation per person per year. All matching contributions vest immediately. Company matching contributions to the 401(k) retirement plan totaled $ 265 and $ 199 for the year ended December 31, 2024 and 2023, respectively. ​ 12. Income Taxes The net loss consists of the following components: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 2023 Domestic ​ $ ( 33,971 ) ​ $ ( 25,767 ) Foreign ​ — ​ ( 21 ) Total ​ $ ( 33,971 ) ​ $ ( 25,788 ) ​ During the years ended December 31, 2024 and 2023, the Company recorded no current or deferred income tax expenses or benefits as the Company has incurred losses since inception and has provided a full valuation allowance against its deferred tax assets. Effective January 1, 2022, the Tax Cuts and Jobs Act of 2017 requires the Company to capitalize, and subsequently amortize R&D expense over five years for research activities conducted in the United States and over fifteen years for research activities conducted outside of the United States. A reconciliation of the expected income tax (benefit) computed using the federal statutory income tax rate to the Company’s effective income tax rate is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 2023 Income tax computed at federal statutory rate 21.0 % 21.0 % State taxes, net of federal benefit 0.3 % 0.5 % Change in valuation allowance ( 21.1 ) % ( 22.4 ) % R&D Credit 2.8 % 4.5 % Equity-based compensation ( 1.8 ) % ( 3.2 ) % Other ( 1.2 ) % ( 0.4 ) % Effective income tax rate — % — % ​ 131 Table of Contents The Company’s deferred tax assets and liabilities consist of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ 2023 Deferred tax assets: ​ ​ ​ ​ ​ ​ Net operating loss carryforwards ​ $ 8,491 ​ $ 6,847 Tax credit carryforwards ​ 3,791 ​ 3,112 Equity-based compensation ​ 477 ​ 407 Operating lease liabilities ​ ​ 114 ​ ​ 148 Capitalized research expenditures ​ ​ 16,089 ​ ​ 11,371 Deferred grant income ​ ​ 224 ​ ​ 223 Other ​ 324 ​ 246 Deferred tax assets ​ 29,510 ​ 22,354 Less: valuation allowance ​ ( 29,400 ) ​ ( 22,207 ) Deferred tax assets after valuation allowance ​ 110 ​ 147 ​ ​ ​ ​ ​ ​ ​ Deferred tax liabilities: ​ ​ Property and equipment, net ​ ​ ( 4 ) ​ ​ ( 8 ) Right-of-use assets, operating leases ​ ( 106 ) ​ ( 139 ) Deferred tax liabilities ​ ( 110 ) ​ ( 147 ) Net deferred tax assets ​ $ — ​ $ — ​ The Company has evaluated the positive and negative evidence bearing upon its ability to realize the deferred tax assets as of December 31, 2024 and 2023. Management has considered the Company’s history of cumulative net losses and has concluded as of December 31, 2024 and 2023, that it was more likely than not that the Company will not realize all of the benefits of the deferred tax assets. Accordingly, a full valuation allowance has been established against the deferred tax assets as of December 31, 2024 and 2023. The valuation allowance increased by $ 7,193 and $ 5,772 for the years ended December 31, 2024 and 2023, respectively. The increase in valuation allowance in 2024 was primarily a result of operating losses and tax credits generated. The Company incurred net operating losses (“NOL”) since inception through December 31, 2021 and year ended December 31, 2024. Due to tax law changes, effective January 1, 2022, requiring the Company to capitalize and amortize R&D expenses, the Company was in a taxable position as of December 31, 2023 and 2022, and has utilized NOL generated in prior years to fully offset their income tax expense. As of December 31, 2024, the Company had federal net operating loss carryforwards of $ 38,063 , net of Section 382 limited amounts. Included in federal net operating loss carryforwards of $ 38,063 is $ 11,503 that begin to expire in 2035 and $ 26,560 that can be carried forward indefinitely. As of December 31, 2024, the Company had state net operating loss carryforwards of $ 12,613 , available to reduce future state taxable income, which will begin to expire in 2028. During the year ended December 31, 2024, the Company ceased operations of its wholly owned foreign subsidiary. As a result, all foreign net operating loss and research tax credit carryforwards were written off with an offsetting decrease to the valuation allowance. Utilization of the Company’s net operating loss carryforwards and research and development tax credit carryforwards may be subject to a substantial annual limitation under Section 382 of the Internal Revenue Code of 1986 due to ownership changes that have occurred previously or that could occur in the future. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50% over a three-year period. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income. The amount of the limitation is determined based on the value of the Company immediately prior to the ownership change and could be subject to additional adjustments as required. Any limitation may result in expiration of a portion of the net operating loss carryforwards or research and development tax credit carryforwards before utilization. In 2023 the Company completed an analysis covering the periods from inception through December 31, 2022 to determine whether there may have been a Section 382 ownership change. This analysis showed an ownership change occurred in January 2009 and the Section 382 limitation would result in $ 589 of federal net operating loss carryforwards expiring unutilized. The Company updated the analysis through December 31, 2024 and determined that it is more-likely-than-not that the Company’s existing net operating loss and research and 132 Table of Contents development tax credit carryforwards could be utilized to offset current and future taxable income or tax, respectively, due to the conclusion that an ownership change did not occur in 2024. The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by federal and state jurisdictions, where applicable. There are currently no pending tax examinations. The Company is open to further tax examination under statue for tax years beginning on or after January 1, 2021; however, carryforward attributes that were generated prior to January 1, 2021 may still be adjusted upon examination by federal, state or local tax authorities if they either have been or will be used in a future period. ​ 13. Segment Reporting ​ Operating segments are defined as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker (CODM), or decision-making group, in making decisions on how to allocate resources and assess performance. The Company views its operations and manages its business in one operating segment related to the development of clinical and preclinical product candidates for neurodegenerative disorders, such as AD and DLB. The Company’s Chief Executive Officer (CEO) serves as the CODM. The CEO manages and allocates resources to the operations of the Company on a consolidated basis. Managing and allocating resources on a consolidated basis enables the CEO to assess the overall level of resources available and how to best deploy these resources across functions and research and development projects that are in line with the Company’s strategic goals. Consistent with this decision-making process, the CEO uses consolidated financial information for purposes of evaluating performance, cash forecasting, allocating resources and setting incentive targets. The CEO bases this assessment on the Company’s consolidated net loss. The measure of segment assets is reported on the consolidated balance sheets as total assets. The table below is a summary of the segment loss, including significant segment expenses (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ 2024 ​ 2023 Grant income ​ $ 19,549 ​ $ 24,805 Less: ​ ​ ​ ​ Clinical programs ​ ​ 27,675 ​ ​ 21,180 R&D Personnel costs (1) ​ ​ 9,672 ​ ​ 8,523 Preclinical programs ​ ​ 810 ​ ​ 3,503 Manufacturing ​ ​ 2,241 ​ ​ 2,890 Other research and development expenses ​ ​ 198 ​ ​ 430 General and administrative expenses (2) ​ ​ 9,622 ​ ​ 9,844 Equity-based compensation ​ ​ 3,748 ​ ​ 4,354 Other segment items (3) ​ ( 446 ) ​ ( 131 ) Segment and consolidated net loss ​ $ ( 33,971 ) ​ $ ( 25,788 ) ​ (1) R&D Personnel costs exclude equity-based compensation (2) General and administrative expenses exclude equity-based compensation (3) Other segment items include, Other income, net, Interest expense and Loss on currency translation from liquidation of subsidiary. ​ ​ ​ ​ ​ 133 Table of Contents Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None. ​