Executive Summary / Key Takeaways

• Contineum Therapeutics ($CTNM) is a clinical-stage biopharmaceutical company focused on developing novel, differentiated small molecule therapies for neuroscience, inflammation, and immunology (NII) indications with significant unmet needs.
• The company's core investment thesis hinges on its proprietary pipeline, particularly the wholly-owned LPA1R inhibitor PIPE-791 for idiopathic pulmonary fibrosis (IPF) and chronic pain, and the M1R inhibitor PIPE-307, partnered with Johnson & Johnson , for depression and relapse-remitting multiple sclerosis (RRMS).
• Key near-term catalysts include topline data from the Phase 2 VISTA trial of PIPE-307 for RRMS expected in Q4 2025, initiation of a global Phase 2 trial for PIPE-791 in IPF in Q4 2025, and topline data from the PIPE-791 Phase 1b chronic pain trial in H1 2026.
• Financially, Contineum maintains a solid liquidity position with $182.40 million in cash, cash equivalents, and marketable securities as of September 30, 2025, projected to fund operations for at least 12 months, despite ongoing net losses driven by substantial R&D investments.
• The company's technological differentiation, particularly the brain-penetrant capabilities of PIPE-791 and PIPE-307's status as the most advanced selective M1R antagonist in clinical development, positions it to potentially capture significant market share in highly competitive therapeutic areas.

A Focused Approach to Neuroscience, Inflammation, and Immunology

Contineum Therapeutics is a clinical-stage biopharmaceutical company dedicated to pioneering differentiated small molecule therapies for neuroscience, inflammation, and immunology (NII) indications. The company's overarching strategy is to target biological pathways associated with specific clinical impairments, aiming to demonstrably alter the course of disease. This foundational approach, established since its incorporation in 2009, underpins its pipeline development and competitive positioning within the demanding biopharmaceutical landscape.

The company's journey has been marked by strategic milestones that have shaped its current trajectory. A pivotal moment arrived in February 2023 with a global license and development agreement for PIPE-307 with Janssen Pharmaceutica NV , a Johnson & Johnson company. This collaboration, further cemented by a $25 million equity investment from Johnson & Johnson Innovation - JJDC, Inc. in April 2023, validated the potential of Contineum's assets and provided crucial non-dilutive funding. The company's public market entry in April 2024 through an Initial Public Offering (IPO), raising approximately $107.90 million in net proceeds, significantly bolstered its financial capacity to advance its ambitious clinical programs.

The biopharmaceutical industry is characterized by intense competition, high R&D costs, and stringent regulatory hurdles. Contineum operates within this dynamic environment, seeking to carve out a significant presence by focusing on novel mechanisms of action and differentiated drug candidates. The company's strategic emphasis on small molecules offers potential advantages in terms of oral administration, manufacturing scalability, and potentially broader patient access compared to complex biologics.

Technological Edge: Precision in Small Molecule Design

Contineum Therapeutics distinguishes itself through its proprietary small molecule drug discovery capabilities, which are central to its competitive strategy. The company's pipeline features two lead clinical-stage assets: PIPE-791 and PIPE-307, each representing a targeted approach to NII diseases.

PIPE-791, Contineum's wholly-owned lead asset, is a novel, brain-penetrant, small molecule inhibitor of the lysophosphatidic acid 1 receptor (LPA1R). LPA1R antagonism is a clinically validated mechanism in idiopathic pulmonary fibrosis (IPF), a severe and progressive lung disease. The tangible benefits of PIPE-791 are rooted in its preclinical and Phase 1 data, which demonstrated high bioavailability, low plasma protein binding, and a long receptor occupancy time. These characteristics, when compared to preclinical data of other LPA1R antagonists, suggest PIPE-791 has the potential to be a differentiated therapy, offering a superior pharmacological profile that could translate into improved efficacy and/or safety for patients. Positive topline data from its Phase 1b Positron Emission Tomography (PET) trial, reported in September 2025, confirmed PIPE-791's brain-penetrant capabilities, a critical feature for its development in chronic pain indications.

The second key asset, PIPE-307, is a novel, small molecule selective inhibitor of the muscarinic type 1 receptor (M1R). Contineum believes PIPE-307 is the most advanced selective M1R antagonist in clinical development, providing a significant competitive advantage in its target indications of depression and relapse-remitting multiple sclerosis (RRMS). This "first-in-class" or "best-in-class" positioning could allow for a substantial market opportunity if clinical trials prove successful. The strategic partnership with Janssen Pharmaceutica NV further validates its potential and provides access to extensive development and commercialization resources.

Beyond these lead programs, Contineum is actively leveraging its drug discovery capabilities to expand its clinical portfolio. The company is conducting preclinical and discovery-phase experiments targeting other NII indications, aiming to identify additional internally-discovered molecules with therapeutic potential. This ongoing R&D effort is crucial for building a sustainable pipeline and maintaining a long-term competitive moat. For investors, this technological differentiation and continuous innovation are critical. They underpin the potential for superior clinical outcomes, which can lead to stronger market adoption, premium pricing, and ultimately, enhanced financial performance and long-term growth.

Competitive Landscape and Strategic Positioning

Contineum Therapeutics operates in highly competitive therapeutic areas, facing established pharmaceutical giants and innovative biotechs. Its competitive standing is shaped by its focused pipeline and technological advantages, which it leverages against broader portfolios and greater financial resources of larger rivals.

In the neurology and immunology sectors, Contineum directly competes with companies such as Biogen Inc. (BIIB), Novartis AG (NVS), Johnson & Johnson (JNJ) (via Janssen), Merck & Co. (MRK), and AbbVie Inc. (ABBV). These competitors possess extensive clinical expertise, large global footprints, and established commercial infrastructures. For instance, Biogen, a leader in neurology and MS treatments, has consistent revenue growth and robust cash flow from established products. Contineum's small molecule approach for PIPE-791 and PIPE-307 offers a differentiated value proposition, potentially providing greater convenience and targeted efficacy compared to some of Biogen's biologic therapies. While Contineum leads in innovation speed for small molecule approaches, it lags in overall market positioning due to Biogen's established presence.

Similarly, Novartis, with its broad portfolio in immunology and neurology, demonstrates strong revenue growth and profitability. Contineum's peripherally-restricted antagonists like CTX-343 aim to provide targeted efficacy, contrasting with Novartis's broader therapeutic options. However, Contineum faces challenges in market share capture against Novartis's scale and faster innovation cycles. Johnson & Johnson, through Janssen, is a partner for PIPE-307, but also a competitor in other NII areas. While PIPE-307's selective M1R inhibition offers a unique mechanism, Johnson & Johnson's diversified revenue streams provide greater financial stability. Merck and AbbVie also present formidable competition with robust pipelines and market leadership in immunology. Contineum's brain-penetrant PIPE-791 could offer improved patient outcomes in areas like MS, but it trails these larger players in market share and overall financial health.

Contineum's competitive advantages lie in its proprietary small molecule technology, particularly the brain-penetrant LPA1R antagonists, which could offer superior targeting for neuroscience indications. This could translate into stronger customer loyalty and improved pricing power in niche markets. Its strategic focus on unmet needs also fosters better capital efficiency. However, the company's smaller scale and early-stage pipeline present vulnerabilities, including limited commercial presence and pipeline dependencies that could impact financial performance and increase R&D costs. The high barriers to entry in biopharma, such as R&D costs, regulatory hurdles, and intellectual property protections, both protect Contineum's innovations and favor larger competitors with greater financial resources.

Financial Performance and Liquidity: Fueling the Pipeline

Contineum Therapeutics, as a clinical-stage biopharmaceutical company, has consistently incurred net losses and negative cash flows from operations since its inception. This is a common characteristic of companies in this sector, reflecting the substantial investment required for research and development activities.

For the three months ended September 30, 2025, the company reported a net loss of $12.79 million, and for the nine months ended September 30, 2025, the net loss was $44.82 million. These figures compare to net losses of $10.27 million and $27.69 million for the respective periods in 2024, indicating an increased burn rate as clinical programs advance.

Operating expenses have risen significantly, primarily driven by increased research and development (R&D) activities. For the nine months ended September 30, 2025, R&D expenses totaled $38.77 million, a substantial increase from $25.41 million in the prior year period. This 52.6% increase was largely due to a $9.10 million rise in contract research organization (CRO) costs, specifically for the Phase 2 trial of PIPE-791 for IPF, the Phase 1b trial for PIPE-791 for chronic pain, and the Phase 1b PET trial for PIPE-791. Personnel-related expenses also contributed to the increase, reflecting an overall growth in headcount. Conversely, R&D expenses for PIPE-307 decreased by 16.5% over the nine-month period, mainly due to reduced costs associated with the VISTA Phase 2 clinical trial for RRMS. General and administrative expenses also increased to $12.18 million for the nine months ended September 30, 2025, up from $8.44 million in the prior year, primarily due to higher personnel costs, stock-based compensation, and public company operating expenses.

Despite these losses, Contineum maintains a strong liquidity position. As of September 30, 2025, the company held $182.40 million in cash, cash equivalents, and marketable securities. This financial strength has been built through various funding activities, including approximately $332.40 million in gross proceeds from equity issuances since inception, a $50 million upfront payment from the Janssen License Agreement in 2023, and $107.90 million in net proceeds from its April 2024 IPO. More recently, in the three months ended September 30, 2025, the company raised an additional $19 million in net proceeds from an at-the-market (ATM) offering program. Management believes these existing capital resources will be sufficient to support operations for at least 12 months from the 10-Q filing date of October 30, 2025. This runway is critical for advancing its pipeline without immediate pressure for further dilutive financing, although the company anticipates needing additional funding in the future through equity, debt, or commercial arrangements.

Outlook and Key Catalysts

Contineum Therapeutics is poised for several significant clinical development milestones over the next 12 months, which management believes will act as important catalysts for the company. Carmine Stengone, President and Chief Executive Officer, affirmed that the company remains on track to achieve all its clinical operations milestones and significant clinical data readouts.

A key near-term event is the expected topline data from the Phase 2 VISTA trial of PIPE-307 for relapse-remitting multiple sclerosis (RRMS) in the fourth quarter of 2025. This data will be crucial in determining the future development path for PIPE-307 in this indication, with Janssen Pharmaceutica NV having the sole discretion to further develop the asset for RRMS. Additionally, Janssen initiated a Phase 2 trial of PIPE-307 (JNJ-89495120) for major depressive disorder (MDD) in December 2024, highlighting the broader potential of this partnered asset.

For its wholly-owned lead asset, PIPE-791, Contineum plans to initiate a global Phase 2 clinical trial in idiopathic pulmonary fibrosis (IPF) in the fourth quarter of 2025. This represents a significant step forward for the program, building on positive Phase 1 data. Furthermore, topline data from the exploratory PIPE-791 Phase 1b chronic pain trial, targeting chronic osteoarthritis and chronic low back pain, is anticipated in the first half of 2026. These upcoming data readouts and trial initiations are critical inflection points that could significantly impact the company's valuation and future prospects.

Management projects that operating expenses will increase significantly in the foreseeable future as the company continues to develop its drug candidates, conduct clinical trials, seek regulatory approvals, expand its pipeline, and grow its operations and headcount. Net losses are expected to fluctuate based on the timing and scope of these R&D expenditures. The company's ability to execute on these clinical development timelines and achieve positive data readouts will be paramount to its success.

Risks and Challenges

Investing in Contineum Therapeutics, like any clinical-stage biopharmaceutical company, involves a high degree of risk. The successful development and commercialization of drug candidates are highly uncertain processes. Key risks include the inherent challenges of clinical trials, such as potential delays in regulatory or institutional review board authorizations, difficulties in negotiating agreements with clinical trial sites or CROs, and the unpredictable nature of trial outcomes. The company explicitly states that it may never succeed in obtaining regulatory approval for any of its drug candidates or successfully commercialize its products, even if approved.

Financing risk remains a significant concern. While Contineum currently has a sufficient cash runway for at least 12 months, its future capital requirements are substantial and depend on numerous factors, including the progress and costs of its clinical trials, regulatory review, manufacturing, and potential commercialization efforts. There is no assurance that additional financing or strategic transactions will be available on acceptable terms, or at all. Should the company need to raise funds through licensing or other commercial arrangements, it may be required to relinquish valuable rights to its technology or future revenue streams, potentially on unfavorable terms that could dilute shareholder value. Furthermore, the competitive landscape is intense, and the success of competing therapies and technologies could materially impact Contineum's ability to gain market share and achieve profitability.

Conclusion

Contineum Therapeutics stands at a pivotal juncture, armed with a differentiated small molecule pipeline targeting high-unmet-need NII indications and a solid cash position to advance its clinical programs. The company's strategic focus on novel mechanisms, exemplified by the brain-penetrant LPA1R inhibitor PIPE-791 and the most advanced selective M1R antagonist PIPE-307, underpins its investment thesis. These technological differentiators are crucial in a competitive landscape dominated by larger pharmaceutical players, offering Contineum a pathway to carve out significant market niches.

The upcoming catalysts, including key data readouts for PIPE-307 and the initiation of a Phase 2 trial for PIPE-791 in IPF, represent critical inflection points that will shape the company's trajectory. While substantial R&D investments will continue to drive net losses, the current liquidity provides a vital runway. For discerning investors, Contineum Therapeutics presents an opportunity rooted in its innovative science and strategic partnerships, with the potential for significant value creation contingent upon successful clinical execution and favorable data outcomes in its pursuit of altering the course of NII diseases.