ANAVEX LIFE SCIENCES CORP.

Anavex Life Sciences Corp. is a clinical stage biopharmaceutical company engaged in the development of differentiated therapeutics by applying precision medicine to central nervous system (CNS) diseases with high unmet need. The Company's focus is on developing innovative treatments for Alzheimer's disease, Parkinson's disease, schizophrenia, neurodevelopmental, neurodegenerative, and rare diseases, including Rett syndrome, and other CNS disorders. Anavex analyzes genomic data from clinical trials to identify biomarkers, which it uses in the analysis of its clinical trials. The Company operates in a single business segment, which is a clinical-stage biopharmaceutical company developing differentiated therapeutics by applying precision medicine to CNS diseases with high unmet need.

The drug discovery and development industry is very competitive, characterized by rapid advancements in technology, where protection of proprietary advancements is essential. Anavex's competitors are primarily other biomedical development companies aiming to discover and develop compounds for the treatment of Alzheimer's disease and other CNS diseases, as well as academic institutions and government agencies. The Company believes its approach to the treatment of Alzheimer's disease and other CNS diseases differs from its competitors, as its platform may offer a disease-modifying approach by activation of SIGMAR1. Competitors may have significantly greater financial resources, an established presence in the market, expertise in research and development, manufacturing, preclinical and clinical testing, or may be in the process of obtaining regulatory approvals and marketing of approved products.

Anavex is a pre-revenue stage company and has not earned any revenues since its inception in 2004. The Company does not anticipate earning any revenues until it can establish an alliance with other companies to develop, co-develop, license, acquire or market its products. Operating costs consist primarily of research and development activities including the cost of clinical studies and clinical supplies as well as clinical drug manufacturing and formulation. General and administrative expenses consist of personnel costs, expenses for outside professional services and expenses associated with operating as a public company.

The Company's research and development pipeline includes ANAVEX 2-73 currently in three different clinical trial indications, and ANAVEX 3-71 currently in one clinical trial and several other compounds in different stages of clinical and pre-clinical development. ANAVEX 2-73 (blarcamesine) is being developed as an oral once-daily capsule formulation for diseases such as Alzheimer's disease and Parkinson's disease, and in an oral liquid once-daily formulation for rare diseases such as Rett syndrome and Fragile X. ANAVEX 3-71 is an orally available clinical drug candidate with a novel mechanism of action via SIGMAR1 activation and M1 muscarinic allosteric modulation, which has been shown to enhance neuroprotection and cognition in Alzheimer's disease models. Other compounds include ANAVEX 1-41, a sigma-1 agonist, ANAVEX 1066, a mixed sigma-1/sigma-2 ligand for potential treatment of neuropathic and visceral pain, and ANAVEX 1037, designed for the treatment of prostate and pancreatic cancer.

In November 2024, the Company announced the submission of a Marketing Authorisation Application (MAA) to the European Medicines Agency (EMA) for ANAVEX 2-73 for the treatment of Alzheimer's disease, and in December 2024, the EMA accepted the submission for scientific review. On November 14, 2025, the Company announced that it was informed by the Committee for Medicinal Products for Human Use (CHMP) of the EMA of a negative trend vote on the MAA following an oral explanation. The CHMP is expected to adopt a formal opinion on the MAA at its December 2025 meeting. The Company plans to request a re-examination of the CHMP opinion upon its formal adoption. In May 2025, the Company announced the completion of enrollment of Part B of the ANAVEX 3-71-SZ-001 clinical trial in schizophrenia, and top-line data was announced in October 2025. On July 25, 2025, the Company entered into a Sales Agreement with TD Securities (USA) LLC to offer and sell up to an aggregate offering price of $150 million ¹ in shares of common stock. During the year ended September 30, 2025, the Company issued an aggregate of 927,910 ² shares of Common Stock under the Sales Agreement for net proceeds of $9.2 million ³. During the year ended September 30, 2025, the Company did not issue any shares of common stock under the 2023 Purchase Agreement with Lincoln Park Capital Fund, LLC.

Operating expenses for fiscal 2025 decreased to $51.4 million ⁴, from $52.9 million ⁵ in fiscal 2024. Net loss for fiscal 2025 was $46.4 million ⁶, or $0.54 ⁷ per share, compared to a net loss of approximately $43.0 million ⁸, or $0.52 ⁹ per share for fiscal 2024. At September 30, 2025, the Company had $102.6 million ¹⁰ in cash and cash equivalents, a decrease from $132.2 million ¹¹ at September 30, 2024. Since inception through September 30, 2025, the Company has accumulated a deficit of approximately $382 million ¹².

The Company expects to see its research and development expenditures increase from current levels as it continues to advance its pipeline compounds. The Company expects to continue to receive support from the Australian government for future clinical trials which it plans to conduct, in part, within Australia.

The Company intends to advance ANAVEX 3-71 into a biomarker-driven clinical development dementia program for the treatment of schizophrenia, FTD and Alzheimer's disease, evaluating longitudinal effect of treatment with ANAVEX 3-71. The first of these trials is being conducted in schizophrenia. The Company anticipates conducting further clinical trials of ANAVEX 2-73 in Parkinson's disease dementia after submitting the results of the trial to regulatory authorities to obtain regulatory guidance. The Company also intends to continue to use its capital resources to advance its clinical trials for ANAVEX 2-73 and ANAVEX 3-71, and to perform work necessary to prepare for future development of its pipeline compounds.

The Company expects to see its research and development expenditures increase from current levels as it continues to advance its pipeline compounds.

The Company intends to continue to use its capital resources to advance its clinical trials for ANAVEX 2-73 and ANAVEX 3-71, and to perform work necessary to prepare for future development of its pipeline compounds.

The Company will need to raise additional funding, and the current economic conditions may have a negative impact on its ability to raise additional needed capital on terms that are favorable to the Company or at all. The Company may not be able to generate significant revenues for several years, if at all. Until it can generate significant revenues, if ever, the Company expects to satisfy its future cash needs through equity or convertible debt financing. The Company cannot be certain that additional funding will be available on acceptable terms, or at all. If adequate funds are not available, the Company may be required to delay, reduce the scope of, or eliminate one or more of its research and development activities.

The Company's ability to compete in the highly competitive biotechnology and pharmaceutical industries depends upon its ability to attract and retain highly qualified managerial, scientific and medical personnel. Competition for skilled personnel in the market is intense and may limit the Company's ability to hire and retain highly qualified personnel on acceptable terms or at all. The Company is highly dependent on its management, scientific and medical personnel. The loss of the services of any of its executive officers, other key employees and other scientific and medical advisors, and an inability to find suitable replacements could result in delays in product development and harm the Company's business.

The regulatory approval processes of the EMA, the FDA, and other comparable foreign authorities are lengthy, time-consuming and inherently unpredictable, and the approval process can vary significantly depending on the regulatory authority. On November 14, 2025, the Company announced that the CHMP of the EMA has rendered a negative trend vote following an oral explanation of its MAA. The CHMP is expected to adopt a formal opinion on the MAA at its December meeting. The Company plans to seek a re-examination of the MAA upon its formal adoption. However, the Company cannot predict the outcome of any interactions with the regulatory authorities and when it will receive a marketing approval, if at all.

The Company has had a history of losses and no revenue, with an accumulated deficit of approximately $382 million ¹³ since inception through September 30, 2025, raising a risk regarding its ability to continue as a going concern. The marketing approval process is burdensome and may not be successful; on November 14, 2025, the CHMP of the EMA rendered a negative trend vote on the MAA for blarcamesine for Alzheimer's disease, and the CHMP is expected to adopt a formal opinion at its December 2025 meeting. The Company may be unable to raise additional capital when needed, which would force it to delay, reduce or eliminate its research and development activities. The Company's research and development plans will require substantial additional future funding, and it may be unable to raise additional capital on favorable terms. If the Company fails to demonstrate efficacy in its non-clinical studies and clinical trials, its future business prospects, financial condition and operating results will be materially adversely affected.

Management's discussion and analysis emphasizes that the Company is in the pre-revenue stage and has not earned any revenues since its inception in 2004. The Company does not anticipate earning any revenues until it can establish an alliance with other companies to develop, co-develop, license, acquire or market its products. Management expects the business to continue to experience negative cash flows for the foreseeable future and cannot predict when, if ever, the business might become profitable. The Company will need to raise additional funds, and such funds may not be available on commercially acceptable terms, if at all. Management believes that the current working capital position will be sufficient to meet the Company's working capital requirements beyond the next 12 months after the date that the consolidated financial statements are issued. The Company has the ability to adjust its operating plan spending levels based on the timing of future clinical trials. The strategic priorities emphasized include advancing clinical trials for ANAVEX 2-73 and ANAVEX 3-71, performing work necessary to prepare for future development of pipeline compounds, and seeking regulatory approval for blarcamesine for the treatment of Alzheimer's disease in the European Union.