Management's Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements, within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, that involve substantial risks and uncertainties. In some cases, you can identify forward-looking statements by the words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "objective," "ongoing," "plan," "predict," "project," "potential," "should," "will," or "would," and or the negative of these terms, or other comparable terminology intended to identify statements about the future. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements. Although we believe that we have a reasonable basis for each forward-looking statement contained in this Quarterly Report on Form 10-Q, we caution you that these statements are based on a combination of facts and factors currently known by us and our expectations of the future, about which we cannot be certain.

The forward-looking statements in this Quarterly Report on Form 10-Q include, among other things, statements about:

You should refer to Part I, Item 1A "Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2025 for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. Those factors are updated, as applicable, in "Factors that May Affect Future Results" below. As a result of the risks, uncertainties and assumptions described above and elsewhere, we cannot assure you that the forward-looking statements in this Quarterly Report on Form 10-Q will prove to be accurate.

Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives and plans in any specified time frame or at all.

You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance, or events and circumstances reflected in the forward-looking statements will be achieved or occur. We undertake no obligation to update publicly any forward-looking statements for any reason after the date of this report to conform these statements to new information, actual results or changes in our expectations, except as required by law.

The following Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with: (i) the interim financial statements and related notes thereto which are included in this Quarterly Report on Form 10-Q; and (ii) our annual financial statements for the 2025 fiscal year, which are included in our Annual Report on Form 10-K for the year ended December 31, 2025.

Company Overview

We are a late-stage clinical company addressing neurodegeneration, such as Alzheimer's disease ("AD") and Parkinson's disease ("PD"). We are developing our lead product candidate, buntanetap, which is designed to address AD, PD, and potentially other chronic neurodegenerative diseases. Buntanetap is a synthetically produced small molecule, orally administered, brain penetrant compound. In several studies, buntanetap was observed to inhibit the synthesis of neurotoxic proteins - APP/Aβ ("APP"), tau/phospho-tau ("tau"), α-Synuclein ("αSYN") and TDP43 - that are some of the main causes of neurodegeneration. High levels of neurotoxic proteins lead to reduced axonal transport, which is responsible for the communication between and within nerve cells. When that communication is compromised, the immune system is activated and attacks the nerve cells, eventually killing them. We have observed in our completed clinical studies in AD and PD patients and pre-clinical studies in mice and rats that buntanetap lowered neurotoxic protein levels leading to improved axonal transport, reduced inflammation, lower nerve cell death and improved affected functions.

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Currently we are conducting two clinical studies - a pivotal Phase 3 study in early AD ("Phase 3AD Trial") (NCT06709014) and an open-label extension ("OLE") study in PD (NCT07284784), and we plan for a third study in Parkinson's disease dementia ("PDD").

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In February of 2025, we initiated the FDA-cleared pivotal Phase 3 AD Trial: a randomized, double-blind, placebo-controlled, multicenter Phase 3 study in 725 early AD patients. The trial investigates buntanetap and consists of two parts: a 6-month treatment period aimed at confirming buntanetap's symptomatic efficacy, followed by an additional 12 months of treatment to show potential disease-modifying efficacy at 18 months. After the 6-month treatment period has been completed, patients will continue to be blinded for an additional 12 months. If well-designed and well-executed, the symptomatic portion of the trial may be sufficient to support a New Drug Application ("NDA") filing, potentially within one year of the 6-month treatment period completion. A similar pathway could be available after 18 months, where a second NDA for disease modification may be supportable with a well-designed and well-executed long-term portion of the trial. The Phase 3 AD Trial is currently enrolling patients, with screening expected to conclude on May 15, 2026, and full enrollment anticipated two months thereafter.

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This pivotal Phase 3 AD Trial will utilize standard clinical outcome measures including Alzheimer's Disease Assessment Scale-Cognitive Subscale 13 ("ADAS-Cog13") and Alzheimer's Disease Cooperative Study-InstrumentalActivities of Daily Living Scale ("ADCS-iADL"). Volumetric MRI imaging and certain plasma biomarkers will also be assessed, including p-tau217 levels and inflammatory markers, leveraging recent biomarker assay advances in AD to better diagnose Alzheimer's patients and disease progression.

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In January of 2026, we began an OLE study to evaluate the long-term safety and efficacy of buntanetap in PD patients. The study aims to enroll 500 patients, who will be treated with buntanetap for 36 months or until buntanetap is on the market. The patient population consists of two cohorts: cohort 1with invited participants from prior clinical

studies and cohort 2 with patients who did not take part in earlier trials but have been receiving deep brain stimulation ("DBS") for at least 12 months following successful surgery. The OLE PD study represents an important step toward a future NDA submission by helping meet the FDA patient exposure requirements.

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In 2025, we further discussed a study in PDD with the FDA. After showing that the amyloid-positive PD population with the Mini Mental State Examination ("MMSE") score above 20 responds exceptionally well to our drug, buntanetap, we received approval to proceed. We are refining the proposed protocol for the PDD program and will initiate the study contingent on additional funding.

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To date, we have concluded 12 clinical studies, in healthy volunteers to assess safety, food effect, pharmacokinetics ("PK"), distribution, etc., and in AD and PD patients to assess safety and efficacy. The most important clinical studies are described below:

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In 2021, we completed two Phase 1/2 clinical studies: one in 14 early AD patients and one in 54 early PD patients (together, the "AD/PD Trials"). In the AD/PD Trials, early AD patients were defined as those with a MMSE score between 19 and 28 and early PD patients as those patients at Hoehn & Yahr stages 1, 2 or 3. MMSE is a brief screening instrument used to assess cognitive function, with total scores ranging from 0 to 30 and a lower score indicating greater disease severity, while the Hoehn & Yahr scale is a medical assessment used to measure staging of the functional disability associated with PD where a higher stage indicates greater disease severity. In collaboration with the Alzheimer's Disease Cooperative Study ("ADCS"), we also conducted a trial in 16 early AD patients (the "ADCS Trial"). In the ADCS Trial, early AD patients were defined as those patients with an MMSE score between 19 and 28. At the completion of the ADCS Trial, the data showed that buntanetap acts as a translational inhibitor in humans just like in animals, and we further observed that there was statistical improvement in cognition in early AD patients, just like in the AD/PD Trials.

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All three clinical trials above were double-blind and placebo-controlled. We designed the studies by applying our understanding of the underlying neurodegenerative disease states and measured both target and pathway validation in the spinal fluid of patients to determine whether patients underlying disease condition improved following treatment. In addition to meeting their primary endpoints of safety and tolerability and secondary endpoint of PK of buntanetap, our AD/PD Trials also met exploratory endpoints of measures of biomarkers and improvements in cognition in AD patients, as well as function in PD patients. We believe that the AD/PD Trials represent the first double-blind, placebo-controlled study that showed improvements in AD patients, as measured by ADAS-Cog and in PD patients, as measured by Unified Parkinson's Disease Rating Scale ("MDS-UPDRS" or "UPDRS"). ADAS-Cog is an assessment scale that measures cognitive functions and non-cognitive functions such as mood and behavior. More specifically, ADAS-Cog-11 is the cognitive assessment scale used to measure areas commonly seen to decline in AD patients. It consists of 11 specific tasks such as word recall, comprehension, object-naming, etc., in order to produce a scale measurement. UPDRS Part II and III are composed of a 42-item rating scale designed to assess PD-related disability and impairment and also evaluate the activities of daily living and motor function.

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Following completion of the AD/PD Trials, we submitted our data to the FDA and requested direction to further pursue the development of buntanetap in early PD patients. With the FDA's guidance, we initiated a Phase 3 study in early PD patients in August 2022 (our "Phase 3 PD Study"). In the Phase 3 PD Study, early PD patients were defined as those at Hoehn & Yahr stages 1, 2 or 3 and OFF times of less than two hours per day. OFF time refers to periods when PD motor and/or non-motor symptoms occur between medication doses. We also submitted a proposed protocol for the treatment of moderate AD to the FDA, and after receiving permission to proceed, we initiated a Phase 2/3 study in mild to moderate AD patients in February 2023 (our "Phase 2/3 AD Study"). In the Phase 2/3 AD Study, mild to moderate AD patients were defined as those with an MMSE score between 14 and 24. Our Phase 3 PD Study and Phase 2/3 AD Study each had built-in interim analyses.

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Our Phase 3 PD Study was completed on December 4, 2023, and we released the topline PD Study efficacy data on July 2, 2024. The study data showed that in two subgroups buntanetap improved UPDRS Part II, III, II+III and total. It also showed that in the entire intent to treat ("ITT") population, buntanetap stopped the loss of cognition and that in the 12% of patients that already had cognitive issues, buntanetap improved cognition in a dose-dependent, statistically significant way. We asked the FDA for a Type C meeting to discuss the data and the continued development of

buntanetap for Lewy body dementia. In response, we received a letter from the FDA saying that because Lewy body dementia is a challenging disease to treat and because there are no accepted endpoints, they would like to discuss the two conditions - dementia with Lewy bodies and PDD - separately and independently. However, the FDA did approve a protocol for an OLE study in PD patients, consisting of two cohorts: cohort 1 with invited participants from prior clinical studies and cohort 2 with patients who did not take part in earlier trials but have been receiving DBS for at least 12 months following successful surgery.

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Our Phase 2/3 AD study was completed on February 13, 2024, and on April 29, 2024, we announced topline efficacy data. The data showed that in early AD patients, buntanetap improved ADAS-Cog11 in a dose-dependent fashion and was statistically significant from placebo and from baseline.

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On October 10, 2024, we met with the FDA in an end-of-phase 2 meeting to discuss its Phase 2/3 AD data and to agree on a regulatory path forward. Annovis and the FDA have aligned on a development path for buntanetap towards the filing of two NDAs, one for short-term and one for long-term efficacy. During the end-of-phase 2 meeting for AD, the FDA raised no concerns with our data on buntanetap's safety, including impact on liver enzymes, drug interactions, dose selection, PK, and population PK. Further, the FDA confirmed that future development can proceed using the new crystal form of buntanetap.

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We believe that we are the only company developing a drug for AD and PD that is designed to inhibit more than one neurotoxic protein and has a mechanism of action designed to restore nerve cell axonal and synaptic activity. By improving brain function, our goal is to treat memory loss and dementia associated with AD as well as body and brain function issues associated with PD. Based on pre-clinical and clinical data collected to date, we believe that buntanetap has the potential to be the first drug to interfere with the underlying mechanism of neurodegeneration, potentially enabling buntanetap to be the only drug to improve cognition in AD and motor function in PD. The industry has historically encountered challenges in specifically targeting one neurotoxic protein, be it APP, tau or αSYN, indicating that doing so does not change the underlying course of neurodegeneration. Our ultimate goal is to develop a disease-modifying drug ("DMD") for patients with neurodegeneration by leveraging our clinical and pre-clinical data, which show inhibition of the most relevant neurotoxic proteins. Studies have found that AD and PD are the most common neurodegenerative diseases in the U.S., and accordingly these diseases present two unmet needs of the aging population and two potentially large U.S. markets, if a DMD is developed and approved.

Future Capital Requirements

We have never been profitable and have incurred net losses since inception. Our accumulated deficit at March 31, 2026 was $181.3 million. We do not have sufficient capital on hand to fund our operations for the next 12 months and will need to raise additional capital to meet our obligations as they become due. We believe that our cash and cash equivalents will be sufficient to fund our operating expenses and capital expenditure requirements until the fourth quarter of 2026. We will need to raise substantial additional capital to complete the development and commercialization of our product candidates through public or private equity offerings, debt financings, collaboration and licensing arrangements or other financing alternatives. However, there can be no assurance that we will be successful in raising additional capital or that such capital, if available, will be on terms that are acceptable to us. If we are unable to raise sufficient additional capital or defer sufficient operating expenses, we may be compelled to reduce the scope of, or cease, our operations. Accordingly, we have concluded that substantial doubt exists with respect to our ability to continue as a going concern within one year after the date that these financial statements are issued.

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We expect to incur losses for the foreseeable future. We also expect these losses to further increase, as we ramp up our clinical development programs and begin activities for commercial launch readiness. We may also encounter unforeseen expenses, difficulties, complications, delays and other currently unknown factors that could adversely affect our business.

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Our future funding requirements, both near and long-term, will depend on many factors, including, but not limited to:

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A change in the outcome of any of these or other variables with respect to the development of any of our product candidates could significantly change the costs and timing associated with the development of that product candidate. Furthermore, our operating plans may change in the future, and we will continue to require additional capital to meet operational needs and capital requirements associated with such operating plans. If we raise additional funds by issuing equity securities, our stockholders may experience dilution. Any future debt financing into which we enter may impose upon us additional covenants that restrict our operations, including limitations on our ability to incur liens or additional debt, pay dividends, repurchase our common stock, make certain investments or engage in certain merger, consolidation or asset sale transactions. Any debt financing or additional equity that we raise may contain terms that are not favorable to us or our stockholders.

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Adequate funding may not be available to us on acceptable terms, or at all. Our potential inability to raise capital when needed could have a negative impact on our financial condition and our ability to pursue our business strategies. If we are unable to raise additional funds as required, we may need to delay, reduce, or terminate some or all development programs and clinical trials. We may also be required to sell or license our rights to product candidates in certain territories or indications that we would otherwise prefer to develop and commercialize ourselves. If we are required to enter into collaborations and other arrangements to address our liquidity needs, we may have to give up certain rights that limit our ability to develop and commercialize our product candidates or may have other terms that are not favorable to us or our stockholders, which could materially and adversely affect our business and financial prospects. See the section of our 2025 Annual Report on Form 10-K titled "Risk Factors" for additional risks associated with our substantial capital requirements.

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Results of Operations

Comparison of the Three Months Ended March 31, 2026 and 2025

The following table summarizes the results of our operations for the three months ended March 31, 2026 and 2025:

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Research and Development Expenses

Research and development expenses for the three months ended March 31, 2026 were $16.7 million, compared to $5.0 million for the three months ended March 31, 2025. The $11.7 million increase was primarily attributable to an increase of $11.9 million for costs associated with our AD 6 month trial patients, an increase of $2.2 million for costs associated with our PD OLE trial, and a decrease of $2.4 million in clinical costs not specifically associated with either study.

General and Administrative Expenses

General and administrative expenses for the three months ended March 31, 2026 were $1.3 million, compared to $1.3 million for the three months ended March 31, 2025. For the three months ended March 31, 2026, General and administrative expenses were increased primarily due to $0.1 million of severance expense related to the Company entering into a separation agreement with its Chief Financial Officer. These costs were offset by a decrease of $0.1 million related to legal fees for corporate and intellectual property matters and employee recruitment costs incurred.

Interest Income

Interest income was $0.1 million for the three months ended March 31, 2026, compared to $0.2 million for the three months ended March 31, 2025. The $0.1 million decrease was driven by lower cash and cash equivalent balances at March 31, 2026 as compared to March 31, 2025, as the March 31, 2025 balance reflected additional funds as a result of our public offering with ThinkEquity, which closed in February 2025. Cash balances have declined since March 31, 2025 due to cash payments to fund our studies.

Change in Fair Value of Warrants

Change in fair value of warrants was a gain of $0.3 million for the three months ended March 31, 2026, compared to a gain of $0.6 million for the three months ended March 31, 2025. The $0.3 million difference between periods was primarily driven by greater volatility in our stock price during the first quarter of 2025, as compared to the same period during 2026.

Liquidity and Capital Resources

Since our inception in 2008, we have devoted most of our cash resources to research and development and general and administrative activities. We have financed our operations primarily with the proceeds from the sale of common stock and warrants. To date, we have not generated any revenue from the sale of products, and we do not anticipate generating any revenue from the sale of products for the foreseeable future. We have incurred losses and generated negative cash flows from operations since inception. As of March 31, 2026, our principal source of liquidity was our cash and cash equivalents, which totaled $14.2 million. We do not believe that our cash on hand will be sufficient to fund our operations for at least twelve months beyond the date of this filing.

April 2026 Canaccord Underwritten Offering

On April 9, 2026, the Company entered into an Underwriting Agreement with Canaccord Genuity LLC ("Canaccord"), with respect to an underwritten public offering of 5.3 million units of the Company, each unit consisting of one share of its common stock, par value $0.0001 per share and one warrant to purchase one share of the Company Stock (the "Canaccord 2026 Warrants"). The units were priced at $1.90 per unit and the offering resulted in gross proceeds of $10.0 million, before deducting underwriting discounts, fees and other related expenses. Net proceeds from the transaction totaled $9.3 million. The Canaccord 2026 Warrants have an exercise price of $2.50 per share, are exercisable after six months from their issuance date, and expire five and one half years from their date of issuance.

October 2025 Registered Direct Offerings and Warrant Issuances

On October 10, 2025, the Company entered into a Securities Purchase Agreement, with the purchasers signatory thereto pursuant to which the Company agreed to issue and sell, in a registered direct offering an aggregate of 3,150,000 shares (the "Shares") of the Company's common stock, $0.0001 par value per share and pre-funded warrants to purchase up to an aggregate of 850,000 shares of Common Stock (the "Pre-Funded Warrants"). The Shares and the Pre-Funded Warrants are collectively referred to herein as the "Securities." The offering price of each Share is $1.50 per share. The offering price of each Pre-Funded Warrant is $1.4999 (equal to the offering price per Share, minus $0.0001, the exercise price of each Pre-Funded Warrant). In addition, in connection with this offering, the Company granted to a placement agent, warrants to purchase a total 200,000 shares of Common Stock (the "October 14, 2025 Placement Agent Warrants") that have an exercise price per share equal to $2.20 and a term of 5 years from the date of issuance. The net proceeds to the Company from the Offering were $5.5 million. The Company issued 850,000 shares of common stock upon the exercise of the pre-funded warrants during the year ended December 31, 2025. As of March 31, 2026, no pre-funded warrants remained outstanding.

On October 26, 2025, the Company entered into (i) a Securities Purchase Agreement, with the purchasers signatory thereto pursuant to which the Company agreed to issue and sell, in a registered direct offering an aggregate of 597,561 shares of the Company's common stock, $0.0001 par value per share and (ii) Stock Subscription Agreements (the "Subscription Agreements") with two members of the Board of Directors of the Company pursuant to which they agree to purchase an aggregate of 1,073,171 shares of Common Stock. An aggregate number of 1,670,732 shares of Common Stock was issued. The offering price of each share was $2.05 per share. In addition, in connection with this offering, the Company granted to a placement agent, warrants to purchase a total 83,357 shares of Common Stock (the "October 26, 2025 Placement Agent Warrants") that have an exercise price per share equal to $2.56 and a term of 5 years from the date of issuance. The aggregate fair market value was recorded as an offset to gross proceeds of the Offering and an increase to additional paid-in capital. The net proceeds to the Company from the Offering were $3.1 million.

February 2025 ThinkEquity Underwritten Offering

On February 3, 2025, the Company entered into an Underwriting Agreement with ThinkEquity LLC ("ThinkEquity"), with respect to an underwritten public offering of 5.3 million units of the Company, each unit consisting of one share of its common stock, par value $0.0001 per share and one warrant to purchase one share of the common stock (the "ThinkEquity Warrants"). The units were priced at $4.00 per unit and the offering resulted in gross proceeds of $21.0 million, before deducting underwriting discounts, fees and other related expenses. Net proceeds from the transaction totaled $19.3 million. The ThinkEquity Warrants have an exercise price of $5.00 per share, are immediately exercisable and expire five years from their date of issuance. None of the ThinkEquity Warrants were exercised as of March 31, 2026.

December 2024 ATM

On December 11, 2024, the Company entered into an Equity Distribution Agreement ("Distribution Agreement") with Oppenheimer & Co. Inc., ("OpCo") relating to the sale of shares of the Company's common stock. In accordance with the terms of the Distribution Agreement, The Company may offer and sell shares of its common stock having an aggregate offering price of up to $50.0 million from time to time through or to OpCo, acting as agent or principal.

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During the three months ended March 31, 2026, the Company sold 1.3 million shares of common stock pursuant to the Distribution Agreement for gross proceeds of $3.8 million, before commissions. During the year-ended December 31, 2025, the Company sold 2.1 million shares of common stock pursuant to the Distribution Agreement for gross proceeds of $6.8 million before commissions.

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Cash Flows

The following table provides a summary of our cash flows for the three months ended March 31, 2026 and 2025:

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Operating Activities

Cash used in operating activities was $9.0 million for the three months ended March 31, 2026, compared to $8.1 million for the three months ended March 31, 2025 The $0.9 million increase in cash used in operations was primarily the result of additional cash paid for clinical trials and related expenses, given the planned timing of study costs and related disbursements.

Contingent upon continued achievement of our fundraising requirements, we expect cash used in operating activities to remain at elevated levels as 2026 progresses, due to expected operating expenditures associated with continued development of our product candidates. More specifically, we expect elevated operating cash burn as a result of costs associated with completing our active Phase 3 AD Trial.

Financing Activities

Cash provided by financing activities for the three months ended March 31, 2026 was $3.7 million and primarily consisted of $3.7 million of proceeds from our Distribution Agreement with OpCo. Cash provided by financing activities for the three months ended March 31, 2025, was $19.8 million and primarily consisted of proceeds from our registered offering with ThinkEquity, as well as proceeds from our Distribution Agreement facility with OpCo.

Contractual Obligations and Other Commitments

This item is not required for smaller reporting companies.

Factors that May Affect Future Results

You should refer to Part I, Item 1A "Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2025 for a discussion of important factors that may affect our future results.

Off-Balance Sheet Arrangements

We did not have any off-balance sheet arrangements during the periods presented, and we do not currently have any off-balance sheet arrangements as defined in the rules and regulations of the SEC.

Critical Accounting Policies and Significant Judgments and Estimates

The preparation of financial statements in conformity with GAAP requires us to use judgment in making certain estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses in our financial statements and accompanying notes. Critical accounting policies are those that are most important to the portrayal of our financial condition and results of operations and require difficult, subjective and complex judgments by Management in order to make estimates about the effect of matters that are inherently uncertain. During the three-month period ended March 31, 2026, there were no significant changes to our critical accounting policies from those described in our annual financial statements for the 2025 fiscal year, which we included in our Annual Report on Form 10-K for the year ended December 31, 2025.

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