Executive Summary / Key Takeaways

• Alpha Cognition has successfully transitioned to a commercial-stage company with the U.S. launch of ZUNVEYL, a differentiated oral treatment for mild-to-moderate Alzheimer's disease, targeting the significant long-term care market.
• Early commercial indicators for ZUNVEYL are encouraging, with approximately $1 million in net sales generated through April 30, 2025, positive feedback on tolerability and efficacy, and favorable initial market access dynamics despite lacking payer contracts.
• A key differentiator for ZUNVEYL is its improved tolerability profile compared to older acetylcholinesterase inhibitors, potentially leading to better patient adherence and outcomes, which is resonating with healthcare providers in the long-term care setting.
• The Company's financial position is significantly strengthened by the $50 million gross proceeds from the November 2024 Nasdaq uplisting and public offering, providing sufficient capital for base operations and initial commercialization efforts, supporting the goal of reaching cash flow breakeven in year three of launch.
• Strategic initiatives, including the CMS licensing deal for Asia-Pacific and ongoing pipeline development like the sublingual formulation and mTBI program, offer potential future revenue streams and market expansion opportunities beyond the initial U.S. long-term care focus.

ZUNVEYL's Debut: A New Chapter for Alpha Cognition in Alzheimer's Care

Alpha Cognition Inc. (NASDAQ: ACOG) stands at a pivotal juncture, having successfully navigated the arduous journey from a development-focused biotechnology firm to a commercial entity with the recent U.S. launch of its lead product, ZUNVEYL. Specializing in treatments for neurodegenerative diseases, ACOG's history is marked by strategic acquisitions of promising technologies, notably the ALPHA-1062 platform which underpins ZUNVEYL, licensed from Neurodyn Life Sciences Inc. in 2015. This foundational technology, coupled with years of preclinical and clinical development, culminated in the transformative U.S. Food and Drug Administration (FDA) approval of ZUNVEYL for mild-to-moderate Alzheimer's disease on July 29, 2024.

The Company's strategic evolution was further solidified by its uplisting to The Nasdaq Capital Market in November 2024, accompanied by a substantial public offering that injected approximately $50 million in gross proceeds into its coffers. This financial bolstering was critical, transitioning ACOG from relying on incremental financings to possessing the capital necessary to fund its initial commercialization strategy and pursue its long-term objectives. The focus is now squarely on executing the commercial launch of ZUNVEYL into the U.S. long-term care market, a segment representing a significant portion of Alzheimer's patients and prescriptions.

The Alzheimer's market is large and characterized by a persistent need for more effective and better-tolerated treatment options. While major pharmaceutical companies like Eli Lilly (LLY) and Biogen (BIIB), often in partnership with companies like Eisai (ESALY), dominate the landscape with established and newer therapies, ACOG is entering with a differentiated product aimed at addressing specific unmet needs within this market. Older acetylcholinesterase inhibitors (AChEIs) like donepezil, rivastigmine, and galantamine are widely used but are often associated with significant gastrointestinal (GI) side effects and sleep disturbances, leading to poor patient adherence. Newer amyloid-targeting therapies from larger players, while offering potential disease modification, often involve complex administration (infusion) and their own set of tolerability challenges.

Technological Edge: ZUNVEYL's Differentiated Profile

At the core of Alpha Cognition's investment thesis is ZUNVEYL's technological differentiation. ZUNVEYL (benzgalantamine) is a novel prodrug of galantamine. While bioequivalent to galantamine in terms of delivering the active metabolite, its unique formulation is designed to minimize absorption in the gut. This is expected to lead to significantly reduced GI side effects compared to traditional galantamine and other older AChEIs. Clinical data suggests potentially 20-30% lower incidence of GI side effects, which is a critical factor for patient comfort and continued treatment, particularly in the vulnerable long-term care population.

Beyond improved GI tolerability, ZUNVEYL's active metabolite also binds to neuronal nicotinic receptors, notably the alpha-7 subtype, which is believed to have a positive effect on cognition. This dual mechanism, combined with the expected reduction in side effects like insomnia often associated with other AChEIs, positions ZUNVEYL as a potentially more tolerable and effective option for mild-to-moderate AD patients. The Company has strengthened its intellectual property around this technology, securing a new U.S. patent for its coated tablet formulation in February 2025, extending protection through 2044, and has applied for an extension on an earlier method of use patent.

This differentiated tolerability profile is ACOG's key competitive moat against both older generics and newer, less broadly accessible therapies. While larger competitors leverage scale, established physician relationships, and broader portfolios, ACOG is strategically focusing its initial commercial efforts on the long-term care segment where patient tolerability and ease of administration are paramount. The oral formulation and reduced side effects are particularly valuable in this setting, potentially leading to higher treatment rates and longer duration of therapy compared to existing options.

Early Commercial Momentum and Financial Snapshot

Alpha Cognition officially launched ZUNVEYL in the U.S. long-term care market on March 19, 2025. The timing aligned strategically with Medicare reimbursement becoming effective on April 1, 2025, a crucial step for access in this patient population. The Company has rapidly built out its commercial infrastructure, hiring experienced leaders and a field sales team in Q1 2025, and has established a retail pharmacy distribution model, ensuring ZUNVEYL is available through major wholesalers.

Early commercial indicators, reported just weeks after launch, are promising. As of May 9, 2025, approximately 500 bottles of ZUNVEYL had been ordered, with roughly 100 unique accounts placing orders, and notably, over half of these accounts had already placed repeat orders. This equates to an average of 17 orders per day in the first five weeks post-Medicare approval. Wholesalers are already restocking initial inventory, with the 5mg starting dose supply being depleted and replenished. This early demand translated into approximately $1 million in net sales through April 30, 2025.

Financially, the first quarter of 2025 reflects this transition to commercialization. Total revenue for the three months ended March 31, 2025, was $2.93 million, a significant increase from zero in the prior-year period. This revenue comprised $346,929 from product sales (ZUNVEYL) and $2.58 million from licensing revenue, primarily the upfront payment from the CMS Asia-Pacific deal. Operating expenses totaled $6.62 million, an increase from $4.41 million in Q1 2024. This rise was largely driven by a substantial increase in selling, general, and administrative (SG&A) expenses, which climbed to $5.37 million from $3.47 million, reflecting investments in commercial operations ($309k), marketing ($47k), employee costs ($1.71M), and share-based compensation ($1.32M) to support the launch. Research and development expenses decreased to $407,511 from $916,716, indicating a shift in focus towards commercial activities following ZUNVEYL's approval.

The net loss for Q1 2025 significantly narrowed to $2.01 million, or $0.13 per share, compared to a net loss of $5.00 million, or $0.87 per share, in Q1 2024. This improvement was primarily due to the new revenue streams, a substantial gain on warrant liabilities ($1.15M), and increased interest income ($470k) earned on the larger cash balance.

Pipeline Expansion and Global Reach

Beyond the U.S. long-term care launch, Alpha Cognition is pursuing strategic initiatives to expand its market opportunity and pipeline. The CMS License Agreement, signed in January 2025, grants exclusive rights for ZUNVEYL in the Asia-Pacific region (excluding certain countries). This partnership provides an upfront payment, potential milestones, and royalties, leveraging CMS's regional expertise for market access and distribution. The first territory launch under this agreement is expected in the second half of 2025, with regulatory submission in China targeted for Q4 2025, potentially generating modest royalty revenue starting in 2026. ACOG is also in discussions for additional ex-U.S. licensing deals.

The Company maintains a preclinical pipeline, including ZUNVEYL in combination with memantine for moderate-to-severe AD and a sublingual formulation of ALPHA-1062 aimed at patients with dysphagia or aphasia (estimated 20% of the AD population) who struggle with tablets. Reformulation work for the sublingual product is underway, with completion expected in Q4 2025. The ALPHA-1062 intranasal program for cognitive impairment with mild traumatic brain injury (mTBI), supported by a DoD grant, is expected to yield study results in Q3 2025 and is intended for out-licensing. While the ALPHA-0602 (Progranulin) program, which holds Orphan Drug Designation for ALS, and related GEMs assets are no longer being developed internally, the Company is seeking to out-license them.

Liquidity, Outlook, and Risks

As of March 31, 2025, Alpha Cognition held approximately $45.5 million in unrestricted cash and cash equivalents. The net proceeds from the November 2024 public offering, approximately $46.15 million, have been strategically deployed, with $2.27 million spent on commercialization/launch, $1.0 million on commercial CMC activities, and $2.57 million on working capital and general corporate purposes by the end of Q1 2025. The Company also successfully repaid its $911,463 promissory note to NLS in Q1 2025, resulting in a debt-free balance sheet.

Management has provided full-year 2025 operating expense guidance in the range of $38 million to $42 million, reflecting the ongoing investments in commercial operations and corporate objectives. While revenue guidance is not being provided, the Company believes its current capital is sufficient to fund projected base operating expenses and initial commercialization costs through at least the next 24 months from the filing date. The long-term financial outlook targets reaching positive cash flow or breakeven status in year three of the ZUNVEYL launch.

This is contingent on successful execution of the commercial strategy, achieving internal revenue forecasts (which anticipate a "hockey stick" uptake as prescribers gain experience), and diligent expense management.

Key risks to this outlook include the inherent uncertainty of market adoption for a new product, particularly the pace at which ZUNVEYL gains traction and achieves the projected "hockey stick" revenue growth. While early payer access has been favorable, there is a risk that prior authorization requirements could become more restrictive as utilization increases. The Company will need to secure additional financing to fully fund further commercial expansion (e.g., into neurology), advance pipeline assets into later-stage clinical trials, or cover ongoing operating costs beyond the current runway if revenue growth does not meet expectations. The competitive landscape, dominated by larger players with significant resources, also presents a challenge, requiring ACOG to effectively communicate ZUNVEYL's differentiation to capture market share.

Conclusion

Alpha Cognition's story is currently defined by the critical launch of ZUNVEYL, its differentiated oral treatment for mild-to-moderate Alzheimer's disease, into the U.S. long-term care market. Early commercial signals, including initial sales figures and positive qualitative feedback on tolerability and efficacy, are encouraging and suggest that ZUNVEYL's unique profile is resonating with healthcare providers. Supported by a strengthened balance sheet following the Nasdaq uplisting and public offering, the Company has the financial runway to execute its initial commercial strategy and pursue its goal of reaching cash flow breakeven in year three. While significant execution risks remain, particularly regarding market adoption and the need for future capital, the early momentum and the potential for ZUNVEYL's differentiation to drive adherence and outcomes provide a compelling narrative for investors focused on the evolving Alzheimer's treatment landscape. The strategic CMS licensing deal and ongoing pipeline development offer additional layers of potential value creation.