Alpha Cognition Inc.

Alpha Cognition Inc. is a biopharmaceutical company focused on developing treatments for neurodegenerative diseases, particularly Alzheimer's disease (AD), where treatment options are limited. The company's primary business objective is the commercial success of its newly FDA-approved ZUNVEYL oral tablet formulation, indicated for mild to moderate dementia of the Alzheimer's type. The company is targeting the long-term care (LTC) market, specifically large volume nursing homes specializing in AD, by leveraging an account-based sales team, positioning ZUNVEYL with Medicare payors, and developing strategic partnerships with consultant pharmacists and LTC pharmacies. The global pharmaceutical and biotechnology markets, particularly in neurodegenerative diseases, are characterized by strong competition and a high rate of drug development failure, with limited innovation in Alzheimer's symptomatic treatments. ¹

The competitive landscape for Alzheimer's disease symptomatic treatments is highly genericized, with donepezil holding approximately 70% market share, rivastigmine 4.86%, and galantamine 2.27%. ² ZUNVEYL is positioned as a next-generation acetylcholinesterase inhibitor with expected minimal gastrointestinal side effects and a dual mechanism of action, enhancing acetylcholine levels and nicotinic receptor sensitivity. ³ The company believes it can differentiate ZUNVEYL based on established efficacy of galantamine, clinical data supporting significant risk reduction in severe dementia and strongest effect on cognition, and an enteric-coated tablet designed to minimize GI side effects. ⁴ Primary market research suggests 88% of LTC prescribers are likely to prescribe ZUNVEYL, with a 29% preference share. ⁵

The core business model involves generating revenue from product sales of ZUNVEYL and licensing arrangements. Product revenue is recognized when control of the product transfers to the customer, net of variable consideration such as prompt pay discounts, chargebacks, product returns, recalls, rebates, and consideration payable to customers. Licensing revenue stems from agreements like the CMSI License Agreement, including upfront payments, potential milestone and royalty payments, and sales of active pharmaceutical ingredient (API) and finished goods.

ZUNVEYL, formerly known as ALPHA-1062 Delayed Release Oral Tablet Formulation, was launched on March 19, 2025. It is a patented new innovative product for the treatment of mild to moderate Alzheimer's disease, with dosage strengths of 5 mg, 10 mg, and 15 mg. ⁶ The Wholesale Acquisition Cost (WAC) for ZUNVEYL has been set at $820 per month. ⁷ The company has three additional pre-clinical development programs: ZUNVEYL in combination with memantine for moderate-to-severe Alzheimer's disease, ALPHA-1062 sublingual formulation for dysphagia patients and cognitive impairment with mild traumatic brain injury (mTBI), and ALPHA-0602, ALPHA-0702 & ALPHA-0802 (Progranulin and Progranulin GEM's) for neurodegenerative diseases like ALS and SMA. ⁸ However, the Progranulin assets were terminated due to not adding material value, with the company retaining certain royalties. ⁹ The company re-acquired rights for ALPHA-1062 for TBI, pancreatitis, and related conditions in January 2025. ¹⁰

For the fiscal year ended December 31, 2025, total revenue was $10,220,275, a 100% increase from $0 in the prior year. ¹¹ This comprised $6,792,024 in product sales, net, and $3,428,251 in licensing revenue. ¹² Cost of product sales was $474,006, and cost of licensing revenue was $1,441,317. ¹³ Research and development expenses decreased by $2,052,440, or 52%, to $1,867,972 from $3,920,412 in 2024. ¹⁴ Selling, general and administrative expenses increased by $21,063,893, or 263%, to $29,076,123 from $8,012,230 in 2024. ¹⁵ The company reported a net loss of $20,669,875 for 2025, compared to a net loss of $14,788,727 in 2024, representing a 40% increase in net loss. ¹⁶ Basic net loss per share was $1.17, and diluted net loss per share was $1.18. ¹⁷ As of December 31, 2025, the company had $66,105,189 in cash and cash equivalents, including restricted cash, and an accumulated deficit of $97,106,775. ¹⁸ Cash used in operating activities increased by $12,624,713 to $20,380,367 in 2025 from $7,755,654 in 2024. ¹⁹

The increase in revenue for 2025 was entirely due to the commencement of ZUNVEYL commercial sales and the $3 million upfront payment from the CMSI License Agreement in January 2025, of which approximately $179,000 has been deferred. ²⁰ The substantial increase in selling, general and administrative expenses by $21,063,893 was driven by a $13.8 million increase in management fees and salaries and employee costs, $2.4 million in marketing and commercial operations, $1.5 million in regulatory costs, and $1.1 million in other general and administrative expenses, all in support of ZUNVEYL's commercial launch. ²¹ Share-based compensation also increased by approximately $4 million. ²² Conversely, R&D expenses decreased by $2,052,440, primarily due to lower product development costs of approximately $762,000 and reduced management fees, salaries, share-based compensation, and employee costs of approximately $1.2 million, reflecting a shift in focus towards commercialization. ²³

During the reported period, Alpha Cognition received FDA approval for ZUNVEYL on July 26, 2024, and officially launched it commercially on March 19, 2025. ²⁴ The company entered into an exclusive licensing agreement with CMS International Development and Management Limited (CMSI) on January 8, 2025, for ZUNVEYL in Asia (excluding Japan), Australia, and New Zealand, with terms totaling $44 million, including $3 million in upfront payments and potential development, commercial milestone payments, and royalties. ²⁵ Key commercial and medical team appointments were announced on January 14, 2025, including Jen Pesa as VP of Commercial, Jack Kelly as Head of Market Access, Rommel Fernandez as VP of Corporate Strategy and Operations, and Kurt Grady as VP of Medical Affairs. ²⁶ The company also completed two public offerings of common stock in November 2024 and October 2025, raising gross proceeds of approximately $50 million and $35 million, respectively. ²⁷

Management explicitly states that the company believes it has sufficient capital to achieve operating profitability by 2027, provided it executes its commercial plan in the LTC market and does not advance compounds in the pipeline. ²⁸ The company expects revenue from commercial sales of ZUNVEYL to continue to grow year over year as it expands its sales force and implements its sales strategy in the coming fiscal year. ²⁹ Additionally, the company is eligible to receive up to $11 million in development and regulatory milestone payments with CMSI, as well as up to $30 million in sales milestone payments, which are expected to contribute to future licensing revenue. ³⁰

A major growth area for the company is the commercialization of ZUNVEYL in the U.S. long-term care market. The company plans to expand promotional efforts and physician promotional coverage, and seek distribution partners for major international territories including Europe, LATAM (Mexico, Central and South America), Middle East, and Asia. ³¹ The exclusive licensing agreement with CMSI for ZUNVEYL in Asia (excluding Japan), Australia, and New Zealand, with total terms of $44 million, including upfront, development, and commercial milestone payments, and royalties on net sales, represents a significant international growth vector. ³²

Another key growth area is the development of pre-clinical assets. The company plans to pursue non-dilutive funding sources for ALPHA-1062 for Cognitive Impairment with mTBI. ³³ Furthermore, the company is advancing benzgalantamine sublingual formulation as a treatment for mild-to-moderate Alzheimer's disease in 2025, having initiated formulation modification and planning a comparative pharmacokinetic study. ³⁴ Pending the outcome of this study, the company intends to meet with the FDA to align on the required clinical study program for approval of the sublingual formulation. ³⁵ The company also plans to progress the development of ALPHA-1062 + memantine, a combination oral product for moderate-to-severe Alzheimer's disease, through a streamlined 505(b)2 regulatory path, which is currently in pre-clinical development. ³⁶ This combination product is expected to offer differentiating efficacy and an attractive tolerability profile, potentially capturing substantial market share due to established physician practice of prescribing combination therapies in later stages of AD. ³⁷

The company expects that cost of product sales will continue to increase year over year in relation to expected increased sales of ZUNVEYL in the coming fiscal year. ³⁸ However, the company anticipates realizing some cost savings to scale as ZUNVEYL production and distribution are streamlined and potential cost-saving measures in the sales strategy are implemented. ³⁹ Conversely, the cost of licensing revenue is expected to decrease year over year until the requirements of the CMSI agreement have been fulfilled. ⁴⁰ The company expects to continue to incur significant expenses and operating losses for the foreseeable future as it continues the commercial rollout of ZUNVEYL and pursues its other product candidates. ⁴¹ Expenses are anticipated to increase substantially as the company establishes a commercialization infrastructure, scales up external manufacturing and distribution, conducts ongoing and planned clinical trials, adapts regulatory compliance for marketed products, maintains and expands its intellectual property portfolio, and hires additional personnel. ⁴²

The company plans to finance its operations through other capital sources, including current or potential future collaborations, licenses, royalties, and other similar arrangements. ⁴³ The company may also contemplate raising additional capital by pursuing both dilutive and non-dilutive strategic sources of capital to fully execute its commercial, R&D, and operating plans for ZUNVEYL. ⁴⁴ In August 2025, the company entered into an ATM agreement with H.C. Wainright & Co., LLC as the sales agent, but has not yet utilized this facility. ⁴⁵

Alpha Cognition faces several material risks, including the potential failure of ZUNVEYL to achieve broad market adoption and commercial success, as well as the possibility that its market opportunities may be smaller than anticipated. The company relies heavily on third-party suppliers for manufacturing, with its sole manufacturing location for ZUNVEYL's active pharmaceutical ingredient (API) in Taiwan, exposing it to supply chain risks from foreign economic downturns and political instability, particularly China-Taiwan geopolitical instability. There is a risk that additional capital, which the company will need beyond the next 12 months, may not be available on a timely basis or on acceptable terms, potentially forcing delays or elimination of research and development programs or commercialization efforts. The company is exposed to fluctuations in currency exchange rates, which could adversely affect its financial results, especially given its U.S. dollar functional currency and operations in Canadian dollars, Euros, and manufacturing in Taiwan and India. ZUNVEYL, despite its approval, remains subject to regulatory scrutiny, including a required root cause investigation into high variability of dissolution data and development of new dissolution methods and acceptance criteria to be reported to the FDA by February 28, 2025. The company did not receive any FDA exclusivity associated with the approval of its NDA 218549 for ZUNVEYL, which could allow competitors to reference its data. Furthermore, an inadvertent inaccuracy in the Orange Book listing for USP 9763953, stating an expiration of May 16, 2027 instead of the actual December 1, 2026, could lead to administrative proceedings or litigation. The company believes it was a "passive foreign investment company" (PFIC) for its most recently completed taxable year and expects to be a PFIC for its current taxable year, which may have adverse U.S. federal income tax consequences for U.S. investors.

Management's message to shareholders emphasizes the company's transition to a commercial-stage biopharmaceutical company with the recent FDA approval and commercial launch of ZUNVEYL. A key strategic priority is to achieve commercial success with ZUNVEYL in the long-term care market, leveraging its differentiated profile and addressing unmet needs in Alzheimer's treatment. The company believes it has sufficient capital to achieve operating profitability by 2027, provided it executes its commercial plan in the LTC market and does not advance compounds in the pipeline. ⁴⁶ Another strategic priority is the pursuit of non-dilutive funding for its pre-clinical assets, such as ALPHA-1062 for mTBI, and advancing the sublingual formulation of benzgalantamine for mild-to-moderate Alzheimer's disease. ⁴⁷ The third priority involves seeking strategic partnerships for international expansion of ZUNVEYL, as evidenced by the exclusive licensing agreement with CMSI for Asia, Australia, and New Zealand, and exploring additional indications and product line extensions for ZUNVEYL, including the combination with memantine for moderate-to-severe Alzheimer's disease.