What changed in this filing

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Item 1. Business

2023-06-23 compared with 2022-06-21 · 199 added, 255 removed, 123 unchanged (79% of the section changed)

On August 27, 2021, we completed our acquisition of Grace via a merger following the approval of Acasti’s shareholders and Grace’s stockholders.

Following completion of the merger, Grace became a wholly owned subsidiary of Acasti and was renamed Acasti Pharma U.S.

The successful completion of the merger positions Acasti to build a premier, late-stage specialty pharmaceutical company focused on developing and commercializing products for rare and orphan diseases that have the potential to improve clinical outcomes by using the Company’s novel drug delivery technologies.

We seek to apply new proprietary formulations to approved and marketed pharmaceutical compounds to achieve enhanced efficacy, faster onset of action, reduced side effects, and more convenient drug delivery and increased patient compliance;

We are focused on developing and commercializing products for rare and orphan diseases that have the potential to improve clinical outcomes by using our novel drug delivery technologies.

We seek to apply new proprietary formulations to approved and marketed pharmaceutical compounds to achieve enhanced efficacy, faster onset of action, reduced side effects, more convenient drug delivery and increased patient compliance;

all of which could result in improved patient outcomes.

The active ingredients chosen by Acasti for further development may be already approved in a target indication or could be repurposed for use in new indications.

The existing well understood efficacy and safety profiles of these marketed compounds provides the opportunity for us to utilize the Section 505(b)(2) regulatory pathway under the Federal Food, Drug and Cosmetic Act (the “FFDCA”) for our reformulated versions of these drugs, and therefore may provide a potentially shorter path to regulatory approval.

Under Section 505(b)(2), if sufficient support of a product’s safety and efficacy either through previous FDA experience or sufficiently within the scientific literature can be established, it may eliminate the need to conduct some of the early studies that new drug candidates might otherwise require.

In connection with the merger, we acquired Grace’s entire therapeutic pipeline, which has the potential to address critical unmet medical needs for the treatment of rare and orphan diseases.

The pipeline consists of three unique clinical stage and multiple pre-clinical stage assets supported by an intellectual property portfolio of more than 40 granted and pending patents in various jurisdictions worldwide.

These drug candidates aim to improve clinical outcomes by applying proprietary formulation and drug delivery technologies to existing pharmaceutical compounds to achieve improvements over the current standard of care, or to provide treatment for diseases with no currently approved therapies.

Rare disorders represent an attractive area for drug development, and there remains an opportunity for Acasti to utilize already approved drugs that have established safety profiles and clinical experience to potentially address significant unmet medical needs.

The active pharmaceutical ingredients used in the drug candidates under development by Acasti may be already approved in a target indication or could be repurposed for use in new indications.

The existing well understood efficacy and safety profiles of these marketed compounds provides the opportunity for us to utilize the Section 505(b)(2) regulatory pathway under the Federal Food, Drug and Cosmetic Act for the development of our reformulated versions of these drugs, and therefore may provide a potentially shorter path to regulatory approval.

Under Section 505(b)(2), if sufficient support of a product’s safety and efficacy either through previous FDA experience or sufficiently within the scientific literature can be established, it may eliminate the need to conduct some of the pre-clinical and clinical studies that new drug candidates might otherwise require.

Our therapeutic pipeline consists of three unique clinical stage and multiple pre-clinical stage assets supported by an intellectual property portfolio of more than 40 granted and pending patents in various jurisdictions worldwide.

These drug candidates aim to improve clinical outcomes in the treatment of rare and orphan diseases by applying proprietary formulation and drug delivery technologies to existing pharmaceutical compounds to achieve improvements over the current standard of care, or to provide treatment for diseases with no currently approved therapies.

We believe that rare disorders represent an attractive area for drug development, and there remains an opportunity for Acasti to utilize already approved drugs that have established safety profiles and clinical experience to potentially address significant unmet medical needs.

A key advantage of pursuing therapies for rare disorders is the potential to receive orphan drug designation (“ODD”) from the FDA.

ODD provides for seven years of marketing exclusivity in the United States post-launch, provided certain conditions are met.

Rare diseases also allow for more manageably scaled clinical trials and provide market opportunities that may require a smaller, more targeted commercial infrastructure.

Acasti's three drug candidates currently in clinical development have received ODD status, provided certain conditions are met at NDA approval.

ODD provides for seven years of marketing exclusivity in the United States post-launch, provided certain conditions are met, and the potential for faster regulatory review.

ODD status can also result in tax credits of up to 50% of clinical development costs conducted in the United States upon market approval and a waiver of the NDA fees, which we estimate can translate into savings of approximately $3.0 million.

Developing drugs for rare diseases can often allow for clinical trials that are more manageably scaled and may require a smaller, more targeted commercial infrastructure.

The specific diseases targeted for drug development by Acasti are well understood although these patient populations may remain poorly served by available therapies or in some cases approved therapies do not yet exist.

We aim to effectively treat debilitating symptoms that result from these underlying diseases.

Our three most advanced programs are:

GTX-104, an IV formulation of nimodipine designed to treat Subarachnoid Hemorrhage (“SAH”), a rare brain disorder for which Acasti Pharma U.S.

had completed multiple pharmacokinetic (“PK”) studies and for which we most recently completed a successful PK study in May 2022.

Our lead drug candidate:

GTX-104, is an IV formulation of nimodipine designed to treat Subarachnoid Hemorrhage (“SAH”), a rare brain disorder for which we have completed multiple pharmacokinetic (“PK”) studies, including a successful PK bridging study recently completed in May 2022.

SAH is a central nervous system condition that causes acute bleeding on the surface of the brain as the result of a ruptured aneurysm and requires immediate medical attention to prevent long-term disability or death.

GTX-104 could be administered to improve the management of hypotension and reduce the incidence of vasospasm in SAH patients and potentially lead to better outcomes.

GTX-102, an oral-mucosal betamethasone spray for the treatment of Ataxia Telangiectasia (“A-T”), a complex orphan pediatric genetic neurodegenerative disorder usually diagnosed in young children, for which no FDA approved treatment exists.

GTX-101, a topical bioadhesive film-forming bupivacaine spray for Postherpetic Neuralgia (“PHN”), which is persistent and often causes debilitating pain following infection by the shingles virus.

GTX-104 could be administered to improve the management of hypotension and reduce the incidence of vasospasm in SAH patients and potentially lead to better patient outcomes.

Other drug candidates:

GTX-101, a topical bioadhesive film-forming bupivacaine spray for Postherpetic Neuralgia (“PHN”), which can be persistent and often causes debilitating pain following infection by the shingles virus.

We believe that GTX-101 could be administered to patients with PHN to treat pain associated with the disease.

Our management team possesses significant experience in drug delivery research and evaluation, clinical and pharmaceutical development and manufacturing, regulatory affairs, and business development, as well as being well-versed in late-stage drug development and commercialization.

The Acasti team has been collectively involved in the development and approval of several successful marketed drugs, including TORADOL, NAPROSYN, ANDROGEL, SUBSYS, MARINOL and KEPPRA XR, Claritin®, Euflex®, Effexor®, Sonata®, Ativan®, RD-Heparin®, Rapamune®, Etodolac Aricept®, Cardizem®, Deflazacort®, Macimorelin®

The table below summarizes planned key 2022 calendar year milestones for our three clinical drug candidates:

In April 2023, we announced the strategic decision to prioritize development of GTX-104 with a goal to advance to commercialization, while conserving resources as much as possible to complete development efficiently.

We estimate that the deferral of GTX-102 and GTX-101 could be 3 years given the timeline to complete the development and commercial launch of GTX 104.

Further development of GTX-102 and GTX-101 will occur at such time as we obtain additional funding or enter into strategic partnerships for license or sale with third parties.

The decision to defer further development has triggered a comprehensive impairment review of our intangible assets in March 2023.

Given the extended timeline, we increased the discount rates used to value the assets in order to recognize additional risks related to prioritizing one asset over the others, financing the projects given limited available resources and the need to preserve cash to advance GTX 104 as far as possible, potential competitor advances that could arise over three years, and the general market depression affecting small cap development companies like us and the prohibitively high dilution and expense of available funding in the capital markets.

Increasing the discount rates significantly reduced the discounted cash flow values for each of the programs deferred.

Accordingly, in the quarter ended March 31, 2023 we booked impairment charges related to GTX 102 and GTX 101 of $22.7M and $6.0M respectively, together with further adjustments made to deferred taxes and goodwill directly related to those assets.

The impairment charge overall amounts to $33.5M.

Management continues to believe that GTX 102 and GTX 101 will eventually provide significant value for the Company when development resumes and they are launched successfully.

Our management team possesses significant experience in drug formulation and drug delivery research and development, clinical and pharmaceutical development and manufacturing, regulatory affairs, and business development, as well as being well-versed in late-stage drug development and commercialization.

Importantly, our team is comprised of industry professionals with deep expertise and knowledge, including a world-renowned practicing neurosurgeon-scientist and respected authority in SAH, as well as product development, chemistry, manufacturing and controls (“CMC”), planning, implementation, management, and execution of global Phase 2 and Phase 3 trials for a drug candidate for SAH.

GTX-104 Overview

Nimodipine was granted FDA approval in 1988, and is the only drug approved to improve neurological outcomes in SAH.

It is only available in the United States as a generic oral capsule and as a branded oral liquid solution called NYMALIZE, which is manufactured and sold by Arbor Pharmaceuticals.

Nimodipine was granted FDA approval in 1988, and is the only approved drug that has been clinically shown to improve neurological outcomes in SAH patients.

It is only available in the United States as a generic oral capsule and as a branded oral liquid solution called NYMALIZE, which is manufactured and sold by Arbor

Pharmaceuticals (acquired in September 2021 by Azurity Pharmaceuticals).

Nimodipine has poor water solubility and high permeability characteristics as a result of its high lipophilicity.

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NIMOTOP is an injectable form of nimodipine that is manufactured by Bayer Healthcare.

It is approved in Europe and in other regulated markets (but not in the United States), but it has limited utility for SAH patients because of its high organic solvent content, namely 23.7% ethanol and 17% polyethylene glycol 400 (NIMOTOP SmPC).

It is approved in Europe and in other regulated markets (but not in the United States).

It has limited utility for SAH patients because of its high organic solvent content, namely 23.7% ethanol and 17% polyethylene glycol 400 (NIMOTOP SmPC).

GTX-104 is a clinical stage, novel formulation of nimodipine for IV infusion in SAH patients.

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This unique nimodipine injectable formulation is composed of a nimodipine base, an effective amount of polysorbate 80, a non-ionic hydrophilic surfactant, and a pharmaceutically acceptable carrier for injection.

GTX-104 is an aqueous solution substantially free of organic solvents, such that the nimodipine is contained in a concentrated injection solution, suspension, emulsion or complex as a micelle, a colloidal particle or an inclusion complex, and the formulation is stable and clear.

Key Benefits:

Novel nanoparticle technology facilitates aqueous formulation of insoluble nimodipine and enables a safe, standard peripheral IV infusion:

Potential for better management of hypotension

GTX-104 is supplied as an aqueous concentrate that upon dilution with saline, dextrose or lactated ringer, is a ready-to-use infusion solution, which is stable and clear.

Key potential benefits of GTX-104 include:

Novel nanoparticle technology facilitates aqueous formulation of insoluble nimodipine for a safe, standard peripheral IV infusion:

Potential for better control of blood pressure and improved management of hypotension

100% bioavailability

Lower inter and intra-subject variability

No food effects

GTX-104 could provide a more convenient mode of administration as compared to generic nimodipine capsules or NYMALIZE GTX-104 is peripherally infused every four hours as compared to administration via a nasogastric tube in unconscious patients every two to four hours for both NYMALIZE oral solution and nimodipine oral capsules.

Therefore, GTX-104 could be considered as a major contribution to patient care by potentially reducing the dosing frequency, and the associated nursing burden.

More convenient and less frequent dosing can also reduce the risk of medication errors.

In addition, two PK studies conducted with GTX-104 has shown that it has the potential to provide improved bioavailability and lower intra-subject variability compared to oral administration.

Because of its IV formulation, we also expect it to reduce certain drug-drug interactions and food effects.

Despite the positive impact it has on recovery, physicians often must discontinue their patients on oral nimodipine, primarily as a result of hypotensive episodes that cannot be controlled by titrating the oral form of drug.

Such discontinuation could potentially be avoided by administering GTX-104, which because of its IV administration, may obviate the complexity that results from the need for careful attention to the timing of nimodipine administration at least one hour before or two hours after a meal.

Administration of GTX-104 via a peripheral vein is often much more comfortable for the patients compared to administration by central venous access, which can often be a difficult and invasive procedure.

Also, unconscious patients will likely receive more consistent concentrations of nimodipine when delivered by the IV route as compared to oral gavage or a nasogastric tube.

Eliminates food effects that impact the absorption of oral form of nimodipine

Lower inter and intra-subject variability as compared to oral nimodipine

GTX-104 could provide a more convenient mode of administration as compared to generic nimodipine capsules or NYMALIZE GTX-104 is administered as an initial bolus followed by a continuous infusion as compared to oral administration via a nasogastric tube in unconscious patients every two to four hours for both nimodipine capsules and NYMALIZE solution.

Therefore, GTX-104 could make a major contribution to patient care by potentially reducing the dosing frequency, and the associated nursing burden.

More convenient continuous, and consistent dosing can also reduce the risk of medication errors.

In addition, as depicted in the charts below, two PK studies have shown that GTX-104 has the potential to provide improved bioavailability and lower intra-subject variability compared to oral administration.

Because of its IV formulation, we also expect GTX-104 to reduce certain drug-drug interactions and food effects.

Despite the positive impact it has on recovery, physicians often must discontinue their patients from oral nimodipine, primarily as a result of hypotensive episodes that cannot be controlled by titrating the oral form of drug.

Such discontinuation could potentially be avoided by administering GTX-104, which because of its IV administration, may reduce the complexity associated with the need for careful attention to the timing of nimodipine administration at least one hour before or two hours after a meal.

Administration of GTX-104 via a peripheral vein is often much more comfortable for the patients compared to administration by central venous access (as is the case for NIMOTOPTM), which can often be a difficult, invasive and more risky procedure.

Also, unconscious patients will likely receive more consistent concentrations of nimodipine when delivered via the IV route as compared to oral gavage or a nasogastric tube.

More consistent dosing is expected to result in a reduction of vasospasm and a better, more consistent management of hypotension.

As summarized in the table below, we anticipate reduced use of rescue therapies, such as vasopressors, and expensive hospital resources, such as the angiography suite, are possible by more effectively managing blood pressure with GTX-104.

As summarized in the table below, we also anticipate reduced use of rescue therapies, such as vasopressors, and expensive hospital resources, such as the angiography suite, are possible by more effectively managing blood pressure with GTX-104.

Reduced incidences of vasospasm could result in shorter length of stay and better outcomes.

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The result is a relatively uncommon type of stroke that accounts for about 5% of all strokes and has an incidence of six per 100,000 person years (Becske, 2018).

In contrast to more common types of stroke in elderly individuals, an SAH often occurs at a relatively young age, with approximately half the affected patients younger than 60 years old (Becske, 2018).

Particularly devastating for patients younger than 45, around 10% to 15% of aneurysmal SAH (“aSAH”) patients die before reaching the hospital (Rinkel, 2016), and those who survive the initial hours post hemorrhage are admitted or transferred to tertiary care centers with high risk of complications, including rebleeding and delayed cerebral ischemia (“DCI”).

In contrast to more common types of stroke in elderly individuals, SAH often occurs at a relatively young age, with approximately half the affected patients younger than 60 years old (Becske, 2018).

Approximately 10% to 15% of aneurysmal SAH (“aSAH”) patients die before reaching the hospital (Rinkel, 2016), and those who survive the initial hours post hemorrhage are admitted or transferred to tertiary care centers with high risk of complications, including rebleeding and delayed cerebral ischemia (“DCI”).

Systemic manifestations affecting cardiovascular, pulmonary, and renal function are common and often complicate management of DCI.

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Of those who survive the initial month, half remain permanently dependent on a caregiver to maintain daily living (Becske, 2018).

Treatment offerings currently include sustained hypervolemia, hemodilution, and/or induced hypertension (Triple-H therapy), calcium antagonists and angioplasty.

Because vasospasm may result from an increase of calcium in the vascular smooth-muscle cell, a medical rationale has emerged for the use of calcium antagonists.

The addition of calcium antagonists like nimodipine to the treatment arsenal for the prevention of cerebral vasospasm after aSAH is based on the notion that these drugs can counteract the influx of calcium into the vascular smooth-muscle cell (Rinkel, 2002).

The incidence of SAH in the United States is approximately 10 in every 100,000 persons per year (Becske, 2016;

Ingall, 1989;

Schievink, 1995;

Schievink, 1997;

Zacharia, 2010), based on multiple analyses of the population of Rochester, Minnesota.

Ingall (1989) studied the incidence of SAH in this population over the 40-year period from 1945 through 1984.

At that time, the population of Rochester lent itself well to epidemiological studies because medical care was provided primarily by the Mayo Clinic.

Over this period, the average annual incidence rate of aSAH remained constant at approximately 11 per 100,000 population.

More recently, the American Heart Association/American Stroke Association Guidelines for the Management of Aneurysmal Subarachnoid Hemorrhage (Connolly, 2012) refer to the 2003 Nationwide Inpatient Sample as providing an annual estimate of 14.5 discharges for aSAH per 100,000 adults, although, because death resulting from aSAH often occurs before hospital admission (in an estimated 10% to 15% of cases), the true incidence may be higher.

According to the U.S.

Census Bureau, Population Estimates for 2015, the U.S.

population was estimated at 321,418,820.

Therefore, we estimate that approximately 53,596 individuals experience aSAH each year.

The total addressable market for SAH is approximately $300 million in the U.S., and an estimated 50,000 patients in the European Union based on annual inpatient admissions and the average length-of-stay.

GTX-104 —

R&D History and Clinical Studies to Date

During 2017 and 2018, Acasti Pharma U.S.

(formerly Grace) evaluated GTX-104 in a four-part, single center, randomized, safety and dose-escalation and crossover study in over 80 healthy male and female subjects designed to assess the PK, bioavailability (“BA”), and the safety of GTX-104 administered via IV infusion compared to nimodipine oral capsules.

Details of the four-part PK study follow below:

Primary Objective:

Evaluate the preliminary cardiovascular safety and tolerability of incremental doses of IV GTX-104 in healthy male and female subjects

Evaluate incremental dose-escalation of GTX-104 administered at dose levels of 0.3 mg/h to 1.22 mg/h over 16 hours, with dose-escalation occurring every 4 hours (0.3, 0.6, 0.9, and 1.22 mg/h)

Adverse Events:

Arthralgia, constipation, flatulence, headache, infusion site irritation, peripheral edema, and vomiting—all adverse events (“AEs”) were rated as mild in severity

Primary Objective:

Evaluate the PK and BA of GTX-104 administered via IV infusion compared to the reference product of oral nimodipine capsules and to select the dose of IV GTX-104 with an exposure profile most closely matching that of oral nimodipine capsules

Two-period, crossover BA study.

Pilot study that evaluated GTX-104 administered open-label as 1.22 mg/h continuous IV infusion for 16 hours compared to oral nimodipine (60 mg every 4 hours for 12 hours) in 12 subjects

Adverse Events:

No serious adverse events ("SAEs") in any subjects.

20.0% of subjects reported non-serious AEs following administration of GTX-104 compared to 50.0% of subjects reporting AEs following administration of oral nimodipine

Primary Objective:

Determine the comparative bioavailability of IV GTX-104 versus oral nimodipine capsules and to evaluate the safety and tolerability of IV GTX 104 compared to oral nimodipine capsules in healthy male and female subjects

BA study, with GTX-104 administered as 1.1 mg/h continuous IV infusion for 28 hours compared to oral nimodipine capsules administered every four hours for 24 hours at a dose level of 60 mg in approximately 32 subjects

Adverse Events:

20.0% of the subjects reported non-serious AEs following administration of GTX-104 whereas 8 (50.0%) subjects reported AEs following administration of oral nimodipine.

Fourteen (34.1%) subjects reported AEs following administration of GTX-104 whereas 18 (43.9%) subjects reported AEs following administration of oral nimodipine

Primary Objective:

Determine the comparative BA of IV GTX-104 versus oral nimodipine capsules and to evaluate the safety and tolerability of IV GTX 104 compared to oral nimodipine capsules in healthy male and female subjects

extension study with the same study design as Part Three, where only GTX-104 was administered open-label as a continuous IV infusion of 1.4 mg/h for 36 hours with oral nimodipine administered for 20 hours (approximately 24 subjects)

Adverse Events:

10 (41.7%) subjects reported AEs following administration of GTX-104 whereas eight (36.4%) subjects reported AEs following administration of oral nimodipine

GTX-104 Near Term Milestones:

- Conduct PK Bridging and Phase 3 Safety Studies

In September 2021, we initiated our pivotal PK bridging study to evaluate the relative bioavailability of GTX-104 compared to currently marketed oral nimodipine capsules in approximately 50 healthy subjects.

The PK study was the next required step in our proposed 505(b)(2) regulatory pathway for GTX-104.

Interim results were reported on December 2, 2021, and we believed at the time and it turned out to be correct, that the tight correlation of the primary endpoint data for the first 20 patients was a strong indication that GTX-104 could achieve comparable bioavailability with oral nimodipine in the full study cohort of 50 subjects.

As observed in a previous PK study, the inter- and intra-subject variability in the interim analysis was much lower for GTX-104 as compared with oral nimodipine.

There were no serious adverse events observed in the first 20 subjects, and only mild adverse events were reported in both groups such as headaches, that were resolved with common medications.

Final results from this pivotal PK study were reported on May 18, 2022, and showed that the bioavailability of IV GTX-104 compared favorably with the oral formulation of nimodipine in all subjects, and no serious adverse events were observed for GTX-104.

The PK study was completed at a single center in Canada and followed a 2-period crossover design where each subject received IV GTX-104 first, followed by oral nimodipine;

or oral nimodipine first, followed by IV GTX-104.

Fifty-eight subjects were randomized in a ratio of 1:1 between IV GTX-104 first or oral nimodipine first.

IV GTX-104 and oral nimodipine was administered to all subjects over a period of 72 hours.

A total of 56 and 55 subjects were included in the PK analysis at Day 1 and Day 3, respectively, as two subjects did not complete one of the two periods and one subject was excluded due to a protocol deviation, as prospectively defined in the statistical analysis plan.

The primary PK endpoints were maximum concentration (expressed as Cmax) during the first 4 hours on Day 1 and the total amount of nimodipine in the blood (expressed as the area under the curve (AUCDay 3, 0-24hr)) on Day 3.

The secondary endpoint was Cmax measured over 24 hours on Day 3.

The ratio of IV/oral is presented below for each endpoint with the corresponding 90% confidence interval (CI).

A ratio of 1 indicates no absolute difference between IV GTX-104 and oral nimodipine.

The IV/oral ratio (%) and its corresponding 90% CI (range) for the primary and secondary endpoints in the subjects who completed each treatment period were as follows:

Day 1 Cmax, 0-4hr:

92% (82 –

AUCDay 3, 0-24hr:

106% (99 –

Day 3 Cmax, 0-24hr:

92% (85 –

All three endpoints indicated that statistically there was no difference in exposures between IV GTX-104 and oral nimodipine over the defined time periods for both maximum exposure and total exposure.

We estimate that approximately 50,000 individuals experience aSAH each year in the US based on third-party market research, and that total addressable market for SAH is approximately $300 million in the U.S.

There are an estimated 150,000 aSAH patients each year in China and approximately 55,000 patients in the European Union based on annual inpatient admissions and the average length-of-stay.

GTX-104 Recent Activities & Near Term Milestones:

Conduct Phase 3 Safety Study

In September 2021, we initiated our pivotal PK bridging trial to evaluate the relative bioavailability of GTX-104 compared to currently marketed oral nimodipine capsules in approximately 50 healthy subjects.

The PK trial was the next required step in our proposed 505(b)(2) regulatory pathway for GTX-104.

Final results from this pivotal PK trial were reported on May 18, 2022, and showed that the bioavailability of GTX-104 compared favorably with the oral formulation of nimodipine in all subjects, and no serious adverse events were observed for GTX-104.

All three endpoints indicated that statistically there was no difference in exposures between GTX-104 and oral nimodipine over the defined time periods for both maximum exposure and total exposure.

Plasma concentrations obtained following IV administration showed significantly less variability between subjects as compared to oral administration of capsules, since IV administration is not as sensitive to some of the physiological processes that affect oral administration, such as taking the drug with and without meals, variable gastrointestinal transit time, variable drug uptake from the gastrointestinal tract into the systemic circulation, and variable hepatic blood flow and hepatic first pass metabolism.

Previous studies have shown these processes significantly affect the oral bioavailability of nimodipine, and therefore cause oral administration to be prone to larger within and between-subject variability.

The bioavailability of oral nimodipine capsules observed was only 8% compared to IV GTX-104.

Consequently, less than one-tenth the amount of nimodipine is delivered with GTX-104 to achieve the same blood levels as with the oral capsules.

In addition, the diurnal variation associated with IV GTX-104 was approximately half of that seen with the oral nimodipine capsules.

Diurnal variation takes into consideration variation in body functions (blood flow, renal function and hepatic metabolism) over the course of a day.

No serious adverse events and no adverse events leading to withdrawal were reported during the study.

More gastro-intestinal disorders were observed with oral nimodipine (16% vs 7% for IV GTX-104), and as expected in the context of a phase I trial conducted in healthy volunteers, more administration and sampling site related events were observed with IV GTX-104 (41% vs 11% for oral nimodipine).

The other most frequently observed adverse events (IV/oral) were headache (36%/36%), somnolence (9%/13%) and hot flashes/flushing (10%/11%).

We plan to submit these results to the FDA, along with our proposed study design for the Phase 3 safety study which continues on track to start in the second half of 2022.

We expect the safety study to be the final step required to seek approval under the 505(b)(2) regulatory pathway before submitting a New Drug Application to the FDA.

Previous studies have shown these processes significantly affect the oral bioavailability of nimodipine, and therefore cause oral administration to be prone to larger inter- and intra-subject variability.

The bioavailability of oral nimodipine capsules observed was only 8% compared to 100% for GTX-104.

Consequently, about one-twelfth the amount of nimodipine is delivered with GTX-104 to achieve the same blood levels as with the oral capsules.

No serious adverse events and no adverse events leading to withdrawal were reported during the trial.

Next Steps –

Initiate Phase 3 Safety trial for GTX-104

In April 2023, we received a Type C written meeting response and clarifying feedback from the FDA on our proposed Phase 3 safety trial for GTX-104.

The FDA provided additional comments on our development plan that, pending submission of the final clinical protocol and FDA approval of same, will allow us to proceed with the initiation of a Phase 3 safety clinical trial in aSAH patients.

The FDA concurred with the suitability of the 505(b)(2) regulatory pathway with the selected Reference Listed Drug NIMOTOP oral capsules (NDA 018869), and that our GTX-104-002 PK trial may have met the criteria for a scientific bridge.

Based on the FDA's proposed Phase 3 trial design, we will target enrollment of aSAH patients (across all grades of severity) in a 1:1 randomized trial with oral nimodipine, to be conducted in an estimated 25-30 sites in the U.S.

The FDA confirmed the use of the Hunt and Hess scale to stratify patients based on severity.

The primary endpoint is safety, and it will be measured as the percentage of significant adverse events of hypotension related to study drugs in both arms.

We expect the first patient to be enrolled during the second half of 2023.

The trial is expected to take approximately18 months to complete from the time the first patient is enrolled, and we expect this safety trial to be the final clinical step required to seek approval under the 505(b)(2) regulatory pathway.

Before submitting a NDA, we plan to hold a pre-NDA meeting with the FDA to enhance the likelihood of market approval.

GTX-102 Overview

GTX-102 is a novel, concentrated oral-mucosal spray of betamethasone intended to improve neurological symptoms of Ataxia Telangiectasia (“A-T”) for which there are currently no FDA-approved therapies.

GTX-102 is a stable, concentrated oral spray formulation comprised of the glucocorticoid betamethasone, that together with other excipients can be sprayed conveniently over the tongue of the A-T patient.

GTX-102 is a stable, concentrated oral spray formulation comprised of the gluco-corticosteroid betamethasone that together with other excipients can be sprayed conveniently over the tongue of the A-T patient and is rapidly absorbed.

About Ataxia Telangiectasia

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Patients typically die by age 25 from complications of lung disease or cancer.

According to a third-party report commissioned by Acasti Pharma US, A-T affects approximately 4,300 patients per year in the United States and has a potential total addressable market of $150 million, based on the number of treatable patients in the United States.

National Institutes of Health (NIH) Genetics Home Reference, the U.S.

National Organization for Rare Disorders (NORD), the U.S.

National Cancer Institute, and the United States National Ataxia Foundation, all estimate the incidence of A-T worldwide to be between 1:40,000 and 1:100,000 live births.

It has been reported in all races throughout the world and is represented equally in males and females (Lavin, 2007;

Sedgwick and Boder, 1972).

For the purposes of estimating prevalence, the maximum survival age observed by Crawford et al., 40 years, has been used.

Assuming a maximum survival of 40 years, the total number of A-T cases has been calculated from 1975 to 2015.

The highest incidence rate reported in the United States of 1:40,000 has been used to obtain an estimate of A-T prevalence today.

Between 1975 and 2015, the highest number of births in one year was 4,316,233 in 2007 (Martin, 2010;

Martin, 2015) and so for the purposes of this prevalence calculation, this has been taken as the number of births per year.

Total A-T cases/year = 25 A-T births/million live births x 4.32 million live births/year = 108 new A-T cases/year.

Assuming that all 108 people possibly born with A-T are still alive today, the total number of individuals with A-T today in the United States, at the very outside estimate = 108 births/year x 40 years = 4320 cases.

population of 321,251,852 (United States Census Bureau) the highest estimated prevalence of A-T is 4320:321,251,852 or 1:74,364.

GTX-102 —

R&D and Clinical Studies to Date

In a multicenter, double-blind, randomized, placebo-controlled crossover trial conducted in Italy, Zannolli et al.

According to a third-party report we commissioned, A-T affects approximately 4,300 patients per year in the United States and has a potential total addressable market of $150 million, based on the number of treatable patients in the United States.

GTX-102 - R&D and Clinical Studies to Date

We have licensed the data from the multicenter, double-blinded, randomized, placebo-controlled crossover trial from Azienda Ospedaliera Universitaria Senese, Siena, Italy, where Dr.

studied the effect of oral liquid solution of betamethasone to reduce ataxia symptoms in patients with A-T.

This oral liquid solution is not marketed in the United States, and therefore is not available for clinical use;

currently, betamethasone is only available in the United States as an injectable or as a

topical cream.

This license gives us the right to reference the study’s data in its NDA filing.

On November 12, 2015, we submitted the data from the Zannolli study to the FDA’s Division of Neurology at a pre-Investigational New Drug (“IND”) meeting and received guidance from the agency on the regulatory requirements to seek approval.

In a multicenter, double-blind, randomized, placebo-controlled crossover trial conducted in Italy, Dr.

Zannolli et al.

studied the effect of an oral liquid solution of betamethasone on the reduction of ataxia symptoms in 13 children (between ages 2 to 8 years) with A-T.

Patients were randomly assigned to first receive either betamethasone or placebo at a dose of 0.1 mg/kg/day for 30 days:

at full dose for the first 10 days, at a tapered dose on days 11–20 (i.e., for 4 days, 0.075 mg/kg/day;

for 4 days, 0.050 mg/kg/day;

and for 2 days, 0.025 mg/kg/day);

and at full dose for the last 10 days (the full dose was tapered in the middle of the treatment phase to reduce risk from potential functional suppression of the hypothalamus-hypophysis-adrenal axis).

Each phase of the trial was followed by a washout period of 30 days.

The primary outcome measure was the reduction in ataxia symptoms as assessed by the International Cooperative Ataxia Rating Scale (“ICARS”).

In the trial, oral liquid betamethasone reduced the ICARS total score by a median of 13 points in the intent-to-treat (“ITT”) population and 16 points in the per-protocol (“PP”) population (the median percent decreases of ataxia symptoms of 28% and 31%, respectively).

In the ITT population, significant improvements were observed in the posture and gait disturbance (p = 0.02), kinetic function (p = 0.02), and speech disorders ICARS subscales (p = 0.02), but not in the oculomotor disorders subscale (p > 0.05).

Similar results were found in the PP population.

In the trial, oral liquid betamethasone reduced the ICARS total score by a median of 13 points in the intent-to-treat population and 16 points in the per-protocol population (the median percent decreases of ataxia symptoms of 28% and 31%, respectively).

Adverse events in the trial were minimal, with no compulsory withdrawals and only minor side effects that did not require medical intervention.

Small increases in body weight were observed in 12 patients on betamethasone and in 4 patients on placebo.

Moon face was present in 8 patients on betamethasone.

Clinical study results in A-T patients administered oral betamethasone indicated that betamethasone significantly reduced ICARS total score relative to placebo (P = 0.01).

Clinical trial results in A-T patients administered oral betamethasone indicated that betamethasone significantly reduced ICARS total score relative to placebo (P = 0.01).

The median ICARS change score (change in score with betamethasone minus change in score with placebo) was -13 points (95% confidence interval for the difference in medians was -19 to -5.5 points).

Clinical Study Results in A-T Patients Administered Oral Betamethasone

Betamethasone

95% Cl for the

-13 (-28 to 14)

Posture and gait disturbance

-5 (-15 to 5)

Kinetic function

-8 (-15 to 10)

Speech disorder

Oculomotor disorders

3.5 (1·5)

Data are medians (ranges).

Thirteen ITT A-T patients are included.

Median differences between the change in the ICARS score related to BETA treatment (d BETA) and the change related to placebo treatment (d placebo).

P values calculated using the Wilcoxon rank sum test.

Betamethasone significantly reduced ICARS total score relative to placebo (P = .01).

The median ICARS change score (change in score with Betamethasone minus change in score with placebo) was -13 points (95% CI for the difference in medians was -19 to -5.5 points).

Based on the Zannolli data, we believe GTX-102 concentrated oral spray has the potential to provide clinical benefits in decreasing A-T symptoms, including assessments of posture and gait disturbance and kinetic, speech and oculomotor functions.

In addition, GTX-102 may ease drug administration for patients experiencing A-T given its application of 1-3x/day of 140µL of concentrated betamethasone liquid spray onto the tongue using a more convenient metered dose spray, as these A-T patients typically have difficulty swallowing (lefton-greif 2000).

Based on the Zannolli data, we believe that our GTX-102 concentrated oral spray has the potential to provide clinical benefits in decreasing A-T symptoms, including assessments of posture and gait disturbance and kinetic, speech and oculomotor functions.

In addition, GTX-102 may ease drug administration for patients experiencing A-T given its application of 1-3x/day of 140µL of concentrated betamethasone liquid sprayed onto the tongue using a more convenient metered dose delivery system, as these A-T patients typically have difficulty swallowing (lefton-greif 2000).

GTX-102 PK Data to Date:

GTX-102 administered as a concentrated oral spray achieves similar blood levels at only 1/70th the volume of an oral solution of betamethasone.

This is important for A-T patients who have difficulties swallowing large volumes of liquids, and it could help to reduce the side effects common with chronic use of a glucocorticosteroid drug.

GTX-102 Near-Term Milestones:

Conduct PK Bridging and Confirmatory Phase 3 Clinical Trials

Acasti Pharma US has licensed the data from the multicenter, double-blinded, randomized, placebo-controlled crossover trial from Azienda Ospedaliera Universitaria Senese, Siena, Italy, where Dr.

studied the effect of oral liquid solution of betamethasone to reduce ataxia symptoms in patients with A-T.

Note that this oral liquid solution is not approved in the United States, and therefore is not available for clinical use.

Betamethasone is only available in the United States as an injectable or as a topical cream.

However, this license gives Acasti Pharma US the right to reference the study’s data in its NDA filing.

On November 12, 2015, Acasti Pharma US submitted the data from the Zannolli study to the FDA’s Division of Neurology at a pre-Investigational New Drug (“IND”) meeting and received guidance from the agency on the regulatory requirements to seek approval.

Based on such FDA guidance, we plan to initiate a PK bridging study of our proprietary concentrated oral spray as compared to the oral liquid solution of betamethasone used in the Zannolli study and against the injectable form of betamethasone that is approved in the U.S.

in the second calendar quarter of 2022.

We expect to report the results of this study before the end of 2022.

Based on the FDA’s guidance and assuming the PK bridging study meets its primary endpoint, we plan to conduct a confirmatory Phase 3 safety and efficacy trial in A-T patients.

The Phase 3 study is expected to be initiated in the first half of 2023.

If both studies meet their primary endpoints, an NDA filing under Section 505(b)(2) would follow.

This more convenient mode of administration will be important for A-T patients who have difficulties swallowing large volumes of liquids.

GTX-102 Recent Activities:

We initiated a PK bridging trial of GTX-102 as compared to the oral liquid solution of betamethasone used in the Zannolli study and against the injectable form of betamethasone that is approved in the U.S.

in the third calendar quarter of 2022.

The primary objectives of the PK bridging trial were to evaluate the bioavailability, pharmacokinetics and safety of GTX-102.

On December 28, 2022, we reported that the topline results of this trial met all primary outcome measures.

Results showed that GTX-102 betamethasone blood concentrations were highly predictable and consistent based on AUC (the area under the concentration time curve up to 72 hours post-dose, extrapolated to infinity) and Cmax (the maximum concentration occurring between 0 hour to 72 hours after study drug administration), indicating good linearity and dose-proportionality.

GTX-102 betamethasone blood concentrations were within the same range of exposure as IM betamethasone, based on AUC.

This IM formulation will serve as a bridge for GTX-102 in the context of the proposed 505(b)(2) regulatory pathway.

GTX-102 betamethasone blood concentrations were also within the same range of exposure as Oral Solution (OS), based on AUC.

This OS formulation was used by Zannolli and may serve as a clinical comparator for further clinical development.

Furthermore, statistically there was no significant difference (p>0.05) between GTX-102 administered at a fast rate (each spray immediately following the preceding one) vs.

a slow rate (1 spray/minute), as indicated by Cmax and AUC.

We believe this result is important because being able to use the fast or the slow rate of administration may provide greater flexibility for patients and caregivers.

The Cmax of GTX-102 was within the same range of exposure as the OS, but the Cmax for the IM formulation was lower than both GTX-102 and the OS, as well as what has been reported previously for the IM in industry publications.

It is important to note that achieving bioequivalence with the IM was not an objective of this trial, nor was it expected.

Finally, of the 48 healthy adult subjects, no serious adverse events (AE) were reported, and the most frequent drug-related adverse effect was mild headache (4 cases).

The further development of GTX-102 has been deprioritized in favor of our focus on development of GTX-104.

Pending additional dedicated funding for GTX-102 or the signing of a strategic partnership, We will work with our clinical experts and the FDA to determine the best final dosing regimen for GTX-102 to incorporate into our Phase 3 trial design.

Based on previous discussions with the FDA, we plan to conduct a confirmatory Phase 3 safety and efficacy trial in A-T patients, and plan to seek guidance from the FDA on the trial design at a Type B meeting.

It is also possible that we may out-license or sell our GTX-102 drug candidate.

GTX-101 Overview

GTX-101 is a non-narcotic, topical bio-adhesive film-forming bupivacaine spray designed to ease the symptoms of patients suffering with postherpetic neuralgia (“PHN”).

GTX-101’s metered-dose of bupivacaine spray forms a thin bio-adhesive topical film on the surface of the patient’s skin, which enables a touch-free, non-greasy application.

GTX-101 is administered via a metered-dose of bupivacaine spray and forms a thin bio-adhesive topical film on the surface of the patient’s skin, which enables a touch-free, non-greasy application.

It also comes in convenient, portable 30 ml plastic bottles.

Unlike oral gabapentin and lidocaine patches, we believe that the biphasic delivery mechanism of GTX-101 has the potential for rapid onset and continuous pain relief for up to eight hours.

No skin sensitivity was reported in a Phase 1 study.

Third party primary market research (2022)

Unlike oral gabapentin and lidocaine patches, we believe that the biphasic delivery mechanism of GTX-101 has the potential for rapid onset of action and continuous pain relief for up to eight hours.

No skin sensitivity was reported in a Phase 1 trial.

About Postherpetic Neuralgia (PHN)

PHN is neuropathic pain due to damage caused by the varicella zoster virus (“VZV”).

Infection with the VZV causes two distinct clinical conditions.

Infection with VZV causes two distinct clinical conditions.

Primary VZV infection causes varicella (i.e., chickenpox), a contagious rash illness that typically occurs among young children.

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PHN is associated with significant loss of function and reduced quality of life, particularly in the elderly.

It has a detrimental effect on all aspects of a patients’

quality of life.

The nature of PHN pain varies from mild to excruciating in severity, constant, intermittent, or triggered by trivial stimuli.

It has a detrimental effect on all aspects of a patient's quality of life.

The nature of PHN pain varies from mild to severe, constant, intermittent, or triggered by trivial stimuli.

Approximately half of patients with PHN describe their pain as “horrible”

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PHN is the number-one cause of intractable, debilitating pain in the elderly, and has been cited as the leading cause of suicide in chronic pain patients over the age of 70 (Hess, 1990).

Current treatment of PHN most often consists of oral gabapentin (first line) and prescription lidocaine patches (second line), and refractory cases may be prescribed opioids to address persistent pain.

Current treatment of PHN most often consists of oral gabapentin (first line) and prescription lidocaine patches or antidepressants (second line), and refractory cases may be prescribed opioids to address persistent pain.

Gabapentin and opioid abuse have continued to proliferate, and lidocaine patches are suboptimal for many reasons.

An independent third party market research firm commissioned by Acasti interviewed more than 250 physicians who regularly treat PHN patients, and found that approximately 40% of patients using lidocaine patches experience insufficient pain relief.

An independent third-party market research firm we commissioned interviewed more than 250 physicians who regularly treat PHN patients, and found that approximately 40% of patients using lidocaine patches experience insufficient pain relief.

Lidocaine patches are difficult to use, fall off, and look unsightly with possible skin sensitivity and irritation.

Additionally, it can take up to two weeks for an optimal analgesic effect to be achieved.

Additionally, lidocaine patches can only be used for 12 hours on and then need to be removed for 12 hours before being reapplied.

Prescription lidocaine patches are only approved for PHN, and the market is currently made up of both branded and generic offerings.

It is estimated that PHN affects approximately 120,000 patients per year in the United States.

According to the third-party report commissioned by Acasti, the total addressable market for GTX-101 could be as large as $2.5 billion, consisting of approximately $200 million for PHN pain and $2.3 billion for non-PHN pain.

According to a third-party report we commissioned, the total addressable market for GTX-101 could be as large as $2.5 billion, consisting of approximately $200 million for PHN pain and $2.3 billion for non-PHN pain indications.

GTX-101 R&D History and Clinical Studies Completed to Date

To date, Acasti Pharma US has conducted three Phase I studies in healthy volunteers to assess the PK, safety and tolerability of GTX-101 and to determine the plasma levels of bupivacaine HCl administered as a single dose in various concentrations, namely 30 mg (three sprays), 50 mg (five sprays), 70 mg (seven sprays) or 100 mg (ten sprays).

The initial study was conducted to determine the PK levels of GTX-101 following a single dose of either 30 mg, 50 mg or 70 mg, and to compare the plasma levels to those produced by a single 30 mg dose of injectable bupivacaine (SENSORCAINETM).

In this study, the plasma levels of bupivacaine were below the limit of quantitation (limit of quantitation (“LOQ”) was 1.00 ng/mL) for almost all subjects administered GTX-101, and at almost all time points.

Mean Cmax and AUC0-T for injectable bupivacaine were 129.3 ng/mL and 517.7 ng/mL, respectively.

Bupivacaine was not detected due to assay sensitivity limited to 1ng/ml.

The second study investigated the PK, safety, and tolerability of a single 100 mg dose (ten sprays) of GTX-101.

The mean bupivacaine Cmax in this study was 1.249 ng/mL for the first set of samples and 1.067 ng/mL for the second set of samples;

the two mean values differing from each other by less than 20%.

The LOQ of the bioanalytical method used for this study was 5 pg/mL.

This study confirmed the Cmax values as being similar from two sets of samples collected from the same patients at the same time points.

In the third study, the PK, safety, and tolerability of a single 100 mg dose (ten sprays) of GTX-101 were again investigated.

This study was a single-center, non-randomized, single dose, open-label, 1-period, 1-treatment design in 10 healthy male and female subjects.

The PK results show the maximum observed plasma concentration of bupivacaine was reached within 20 to 48 hours for all subjects.

The maximum concentration reached was 19.59 ng/mL.

This study confirmed that bupivacaine delivered as a spray (GTX-101) is well absorbed through the skin, as demonstrated in the graph below, while very little is absorbed systemically.

In all three studies, the administration of GTX-101 to healthy volunteers was safe and well tolerated.

To date, we have conducted four Phase I trials in healthy volunteers to assess the PK, safety and tolerability of GTX-101 and to determine the plasma levels of bupivacaine HCl administered as a single dose in various concentrations between 30 mg (three sprays) and 2100 mg (twenty sprays).

These studies confirmed that bupivacaine delivered as a topical spray (GTX-101) is well absorbed through the skin, as demonstrated in the graph below, while very little is absorbed systemically.

In all four studies, the administration of GTX-101 to healthy volunteers was safe and well tolerated.

In addition, no evidence of skin irritation was observed at the application site following the spray administrations.

GTX-101 Near-Term Milestones:

Conduct Dose Ranging Phase 1 Clinical Trials of GTX-101

The data below is from two separate trials of GTX-101 and the Lidoderm patch superimposed on each other.

GTX-101 recent activities:

We believe that the PHN pain market will continue to grow, and non-opioid products like GTX-101 that can relieve PHN pain more quickly and in a sustained manner by means of a more efficient delivery system, will be an attractive therapy option for patients and physicians.

GTX-101 is administered by spraying a proprietary bupivacaine formulation over the affected area, which we believe has the potential to provide several advantages over currently marketed products such as the lidocaine patch, including faster onset of action, sustained pain relief, possibly lower dosing requirements and improved dosing convenience, all which could lead to increased patient compliance.

The data from the single dose Phase 1 clinical trial for topical bupivacaine spray along with regulatory guidance from the FDA’s Division of Anesthesiology that was received at a pre-IND meeting on April 18, 2018 has informed the design of additional preclinical toxicology studies and a clinical and regulatory pathway to approval.

We expect to report the results of a minipig skin sensitivity study in the third calendar quarter of 2022.

We also plan to initiate a single dose and a multiple ascending dose study in healthy human volunteers in the third calendar quarter of 2022.

We expect to report both of these results for these studies before the end of 2022.

Results from these pre-clinical and clinical studies are required before we can initiate our program in PHN patients, which we expect will start in early 2023.

GTX-101 is administered by spraying our proprietary bupivacaine formulation over the affected area, which we believe has the potential to provide several advantages over currently marketed products such as the lidocaine patch, including faster onset of action, sustained pain relief, possibly lower dosing requirements and improved dosing convenience, all which could lead to increased patient satisfaction and compliance.

The data from the single dose Phase 1 clinical trial for GTX-101 was submitted to the FDA’s Division of Anesthesiology and feedback was received at a pre-IND meeting on April 18, 2018, that informed the design of pre-clinical toxicology studies and a clinical and regulatory pathway to approval under section 505(b)(2).

We completed a minipig skin sensitivity study in the second calendar quarter of 2022, and we initiated a single dose PK trial in healthy human volunteers in July 2022.

Topline results from this single dose PK trial were reported on December 23, 2022 and the results met all primary outcome measures.

The median Tmax (the time of maximum concentration between 0 hour and 240 hours after study drug administration) of bupivacaine in plasma following GTX-101 single-dose topical applications ranged between 18 to 24 hours depending on dose, while the median Tmax following the subcutaneous injection of 10 mg of bupivacaine was only 23 minutes.

This result suggests that bupivacaine delivered by GTX-101 remains in the skin for a long period of time, potentially inducing prolonged analgesic effect in the sprayed area.

The exposure to bupivacaine based on Cmax (the maximum concentration occurring at Tmax between 0 hour and 240 hours after study drug administration) and AUC (the area under the concentration time curve, extrapolated to infinity) following GTX-101 topical application as a single-dose increased with increasing dose.

The systemic exposure to bupivacaine following a 200mg dose of GTX-101 was approximately 29-fold less than a single subcutaneous dose of 10mg of bupivacaine based on Cmax and approximately 6-fold less than a single subcutaneous dose of 10mg of bupivacaine based on AUC.

We predict these lower blood levels will correspond to an increased safety margin for GTX-101 with regards to toxicity risk.

Mean half-life (T half) following GTX-101 single-dose topical applications ranged between 24 to 37 hours depending on dose, suggesting a slow elimination and potentially long duration of effect, while mean Tmax following the subcutaneous injection of 10 mg of bupivacaine was only 8 hours.

There were only two adverse events judged as related to the study drug by the investigator for each of GTX-101 and the bupivacaine subcutaneous injection.

Following GTX-101 topical application:

headache (1 event = 3%) and numbness (1 event = 3%) at the sprayed area following bupivacaine subcutaneous injection:

dizziness (1 event = 8%) and nausea (1 event = 8%).

The further development of GTX-101 has been deprioritized in favor of our focus on development of GTX-104.

Pending additional dedicated funding for GTX-101 or the signing of a strategic partnership, we plan to follow this successful PK trial with a multiple ascending dose study in 2023.

Results from these non-clinical and clinical studies and trials are required before the initiation of our Phase 2 program in PHN patients.

It is also possible that we may out-license or sell our GTX-101 drug candidate.

Overall Commercialization Strategy

We plan to retain our worldwide commercialization rights for some of our key drug candidates, while for other drug candidates we might consider collaboration opportunities to maximize market penetration and returns.

If we receive regulatory approval, we expect to build a small and focused commercial organization in the United States to market and sell GTX-104 and GTX-102.

We believe the patient populations and medical specialists for these indications are sufficiently concentrated to allow us to cost-effectively promote these drug products following approval for commercial sale.

Given that GTX-101 will be targeted to a larger primary care and pain specialist market, if GTX-101 receives regulatory approval, it is likely we will seek commercial partnerships to fully exploit the market potential of this drug product.

As product candidates advance through the pipeline, our commercial plans may change.

Clinical data, the size of the development programs, the size of the target market, the size of a commercial infrastructure and manufacturing needs may all have influence on U.S., European Union, and rest-of-world strategies.

We plan to retain our worldwide commercialization rights for some of our key drug candidates, while for other drug candidates we may consider collaboration opportunities to maximize market penetration and returns.

If we receive regulatory approval, we may look to out license commercialization opportunities or consider outsourcing sales to ensure efficient commercial management.

A similar review and approach will be applied to GTX-102.

Given that GTX-101 will be targeted to a larger primary care and pain specialist market, if GTX-101 receives regulatory approval, we will likely seek commercial partnerships to fully exploit the market potential of this drug product.

As our product candidates advance through the pipeline, our commercial plans may change.

Clinical data, the size of the development programs, the size of the target market, the size of a commercial infrastructure and manufacturing needs may all influence our U.S., European Union, and rest-of-world strategies.

Currently, we have prioritized the development of GTX-104 and de-emphasized the development of GTX-102 and GTX-101.

It is possible that we may out-license or sell GTX-102 and/or GTX-101.

Manufacturing and Supply

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Further, these processes undergo a high level of scrutiny by regulatory agencies.

Consequently, we utilize a network of third-party contract manufacturers (“CMOs”) for manufacturing of our drug candidates.

Consequently, we utilize a network of third-party CMOs for manufacturing of our drug candidates.

All CMOs are monitored and evaluated by us to assess compliance with regulatory requirements.

We work with and regularly inspect our manufacturers to review the manufacturing process for our drug candidates and to provide input on quality issues.

We have addressed the risk of supply chain disruptions through risk management strategies designed to mitigate the effects of any disruptions.

While this strategy creates additional effort and requires maintaining dialogue and traveling to and overseeing production at multiple facilities, we believe our manufacturing risks are better managed by utilizing a range of specialized third-party manufacturers at diverse locations.

We work with independent consultants to perform periodic quality audits of our manufacturers to review the manufacturing process for our drug candidates and to provide input on quality issues.

All lots of the drug substance and drug product used in clinical supply are manufactured under current good manufacturing practices.

We plan to continue to rely upon CMOs to manufacture clinical and commercial quantities once the product is approved.

We have development agreements in place with these CMOs and we have personnel with pharmaceutical development and manufacturing experience who are responsible for the relationships with our CMOs.

Intellectual Property Portfolio

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The actual protection afforded by a patent may vary on a product-by-product basis from country to country and can depend upon many factors, including the type of patent, the scope of its coverage, the availability of regulatory-related extensions, the availability of legal remedies in a particular country and the validity and enforceability of the patent.

Acasti Pharma US has several issued U.S.

We have several issued U.S.

patents and patent applications as well as patents and patent applications in other jurisdictions.

Four patents for GTX-104 have been granted in the United States.

Five patents for GTX-104 have been granted in the United States.

One patent for GTX-101 has been granted in Europe, China, Mexico, Japan and South Africa.

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Recent Developments

On March 22, 2022 we announced the awards of several patents relating to our three lead drug candidates.

The European Patent Office provided notice of intention to grant the Company’s composition of matter patent for GTX-104.

The patent is expected to be valid until 2037.

The United States Patent and Trademark Office also issued a notice of allowance for our composition of matter patent for GTX-102.

The patent is expected to be valid until 2037.

Finally, the Japanese Patent Office granted a composition of matter patent for our GTX 101 topical spray.

The granted patent is valid until 2036.

On March 25, 2022 we announced the appointment of Michael L.

Derby to our board of directors, filling the remaining seat on our board of directors recommended by the former Grace stockholders as contemplated by the merger agreement for the Grace transaction.

On May 18, 2022, we announced that the top line results of the PK bridging study with IV GTX-104, our lead drug candidate for the treatment of SAH, met all its planned study endpoints.

The primary objective of the study was to evaluate the relative bioavailability of IV GTX-104 compared to oral nimodipine in healthy adult male and female subjects, while the secondary objective was to assess its safety and tolerability.

On May 23, 2022 we announced that we have retained one of the industry's leading investor relations firms, Lytham Partners, LLC, to lead a strategic investor relations and shareholder communication program for the Company.

On June 14, 2022 we announced the issuance of additional patents for GTX-104 and GTX-101.

Three composition of matter patents were issued for GTX-104 by The United States Patent and Trademark Office, the Japanese Patent Office, and the Australian Patent Office.

Additionally, one new patent for GTX-104 was awarded by the Indian Patent Office.

These granted patents are all valid until 2037.

COVID-19 Update

To date, the ongoing COVID-19 pandemic has not caused significant disruptions to our business operations and research and development activities.

The extent to which the COVID-19 pandemic impacts our business and prospects and the timing and completion of future clinical trials for our new drug candidates will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of the COVID-19 pandemic and the actions to contain the COVID-19 pandemic or treat its impact, among others.

Announcement of centralization of marketplace for shares on the Nasdaq with voluntary delisting from TSX Venture Exchange

On March 13, 2023, we announced that we had applied and received approval for a voluntary delisting of our common shares from the TSX Venture Exchange ("TSXV").

The delisting from the TSXV did not affect the Company's listing on the Nasdaq Capital Market (the "Nasdaq").

The common shares continue to trade on the Nasdaq under the symbol "ACST".

Effective as at the close of trading on March 27, 2023, Acasti's common shares were no longer be listed and posted for trading on the TSXV.

Announcement of resignation of a director

On March 30, 2023, we announced that effective immediately, Mr.

Jean-Marie (John) Canan had tendered his resignation from the board of directors of the Company.

Announcement of appointment of Prashant Kohli as CEO

On April 4, 2023, we announced the appointment of Prashant Kohli as Acasti's new Chief Executive Officer, succeeding Jan D'Alvise.

The parties mutually agreed to part ways, and Ms.

D'Alvise stepped down from the board of directors of the Company.

Announcement of intention to proceed with Phase 3 clinical safety study for GTX-104 following FDA feedback

On April 4, 2023 we announced that we received a Type C written meeting response and clarifying feedback from the FDA on our proposed Phase 3 safety study for GTX-104.

The FDA provided additional comments on our development plan that, subject to submission of the final clinical protocol and FDA approval of same, will allow us to proceed with the initiation of a Phase 3 safety clinical trial in aneurysmal aSAH patients.

Announcement of successful submission of pivotal GTX-104 Phase 3 safety study protocol with FDA and implementation of strategic realignment plan

On May 8, 2023, we announced the successful submission to the FDA of GTX-104's full protocol of its pivotal Phase 3 safety study and implementation of a strategic realignment plan to maximize shareholder value.

The realignment follows a comprehensive strategic review of the Company by Prashant Kohli, its recently appointed CEO, and its board of directors.

Key strategies being implemented are:

Prioritizing resources to GTX-104.

We submitted the full pivotal Phase 3 safety study protocol for GTX-104 with the FDA with all supporting documentation.

Pending final feedback and approval from the FDA, the first patient, first dose for the pivotal Phase 3 safety study is expected in calendar Q4 2023.

Strategic transformation of our operating model to an agile biopharma reflecting its complete focus on GTX-104.

In alignment with the operating model, Acasti has brought on a highly experienced new management team with deep subject matter knowledge and direct, hands-on clinical trial experience in aSAH.

Significant extension of our cash runway expected to be sufficient to fund the Company through calendar Q2 2025, facilitating achievement of critical value inflection milestones, including a potential NDA filing for GTX-104.

Evaluation of strategic alternatives to maximize value of de-prioritized pipeline assets, GTX-102 and GTX-101

In connection with the transformation of the operating model, we have moved to appoint the following industry experts to our senior management team:

Loch Macdonald, MD, PhD, as Chief Medical Officer.

A world-renowned practicing neurosurgeon-scientist and respected authority in SAH, Dr.

Macdonald is the former founder of a clinical-stage biotechnology company focused on subarachnoid hemorrhage.

Carrie D’Andrea, as VP Clinical Operations.

D’Andrea is a highly experienced professional who has built and led the planning, implementation, management, and execution of global Phase 2 and Phase 3 trials for a drug candidate for subarachnoid hemorrhage.

Amresh Kumar, PhD, as VP Program Management.

Kumar is an experienced drug development, CMC, and program management expert.

Amresh is the former product leader of GTX-104 while at Grace Therapeutics (which was acquired by us).

As a result of this strategic realignment, we are, over time, discontinuing our operations in Canada, and have proceeded to lay off substantially all our workforce, allowing our new management team to rebuild a leaner organization in the United States.

All of our finance team will remain in their current role for a transition period until at least the end June 2023.

Corporate Structure

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AIAG currently does not have any operations.

On August 27, 2021, Acasti completed its acquisition of Grace via a merger following the approval of Acasti’s shareholders and Grace’s stockholders.

On August 27, 2021, Acasti completed its acquisition of Grace Therapeutics Inc.

via a merger.

Following completion of the merger, Grace became a wholly owned subsidiary of Acasti and was renamed Acasti Pharma U.S.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business