UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
x
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended April 30, 2025
̈
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
For the transition period from
_______________ to _______________
Commission file number 001-40483
ALZAMEND NEURO, INC.
(Exact name of registrant
as specified in its charter)
Securities registered under Section 12(b) of the
Act:
Title of Each Class Trading Symbol Name of each exchange on which registered
Common Stock, $0.0001 par value per share ALZN NASDAQ Capital Market
Securities registered under Section 12(g) of the
Act: None
Indicate by check mark if the registrant is a
well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ̈Nox
Indicate by check mark if the registrant is not
required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ̈Nox
Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding year (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yesx No ̈
Indicate by check mark whether the registrant
has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405
of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yesx No ̈
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.
See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,”
and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ̈ Accelerated filer ̈
Non-accelerated filer x Smaller reporting company x
Emerging growth company x
If an emerging growth company, indicate by check
mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. ̈
Indicate by check mark whether the registrant
has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or
issued its audit report. ̈
If securities are registered
pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing
reflect the correction of an error to previously issued financial statements. ̈
Indicate by check mark
whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by
any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). o
Indicate by check mark whether the registrant
is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ̈Nox
The aggregate market value of the common stock held by non-affiliates of the registrant, based on the closing price of the shares of common stock on October 31, 2024 (the last business day of the registrant's most recently completed second fiscal quarter), as reported by The Nasdaq Stock Market LLC on such date was approximately $8.2 million. Shares of the registrant's common stock held by each executive officer and director and by each other person who may be deemed to be an affiliate of the registrant have been excluded from this computation. This calculation does not reflect a determination that certain persons are affiliates of the registrant for any other purpose.
There were 2,896,432
shares of common stock outstanding as of July 22, 2025.
Documents incorporated by reference: None
ALZAMEND NEURO, INC.
FORM 10-K
FOR THE FISCAL YEAR ENDED APRIL 30, 2025
INDEX
Page
PART I
Item 1. Business 2
Item 1A. Risk Factors 21
Item 1B. Unresolved Staff Comments 43
Item 1C. Cybersecurity 43
Item 2. Properties 44
Item 3. Legal Proceedings 44
Item 4. Mine Safety Disclosures 44
PART II
Item 6. [Reserved] 45
Item 7A. Quantitative and Qualitative Disclosures About Market Risk 54
Item 8. Financial Statements and Supplementary Data 54
Item 9A. Controls and Procedures 55
Item 9B. Other Information 56
Item 9C. Disclosures Regarding Foreign Jurisdictions that Prevent Inspections 56
PART III
Item 10. Directors, Executive Officers and Corporate Governance 57
Item 11. Executive Compensation 61
Item 14. Principal Accountant Fees and Services 69
PART IV
Item 15. Exhibit and Financial Statement Schedules 70
Signatures 72
NOTE ABOUT FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K (the “Annual
Report”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of
the Securities Exchange Act of 1934, as amended. These statements relate to future events or our future financial performance. We have
attempted to identify forward-looking statements by terminology including “anticipates,” “believes,” “expects,”
“can,” “continue,” “could,” “estimates,” “expects,” “intends,”
“may,” “plans,” “potential,” “predict,” “should” or “will” or
the negative of these terms or other comparable terminology. These statements are only predictions; uncertainties and other factors may
cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels or
activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations
reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.
Our expectations are as of the date this Annual Report is filed, and we do not intend to update any of the forward-looking statements
after the date this Annual Report is filed to confirm these statements to actual results, unless required by law.
This Annual Report also contains estimates and
other statistical data made by independent parties and by us relating to market size and growth and other industry data. This data involves
a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. We have not independently verified
the statistical and other industry data generated by independent parties and contained in this Annual Report and, accordingly, we cannot
guarantee their accuracy or completeness, though we do generally believe the data to be reliable. In addition, projections, assumptions
and estimates of our future performance and the future performance of the industries in which we operate are necessarily subject to a
high degree of uncertainty and risk due to a variety of factors, including those described in “Risk Factors” and elsewhere
in this Annual Report. These and other factors could cause results to differ materially from those expressed in the estimates made by
the independent parties and by us.
RISK FACTOR SUMMARY
Below is a summary of
the principal factors that make an investment in our common stock speculative. This summary does not address all of the risks that we
face. Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under
the heading “Risk Factors” and should be carefully considered, together with the other information in this Annual Report and
our other filings with the Securities and Exchange Commission (the “SEC”), before making investment decisions regarding our
common stock.
· Our intellectual property rights present a number of risks.
· Our affiliates and related party transactions present a number of risks.
PART I
ITEM 1. BUSINESS
In
this Annual Report, unless the context requires otherwise, references to the “Company,” “Alzamend,” “we,”
“our company” and “us” refer to Alzamend Neuro, Inc., a Delaware corporation and its subsidiary.
Company Overview
We
are a clinical-stage biopharmaceutical company focused on developing novel products for the treatment of Alzheimer’s disease (“Alzheimer’s”),
bipolar disorder (“BD”), major depressive disorder (“MDD”) and post-traumatic stress disorder (“PTSD”).
With our two product candidates, we aim to bring treatments or potential cures to market as quickly as possible. Far too many individuals,
including patients and caregivers, suffer from the burden created by these devastating, and often fatal, diseases. Our primary target,
Alzheimer’s, is among the most-feared diseases (second only to cancer) among Americans, according to a 2023 Center for Disease Control
survey. Alzheimer’s is also the seventh leading cause of death (in 2021 and 2022) in the United States (“U.S.”) according
to a 2025 report from the Alzheimer’s Association, a nonprofit that funds research. Existing Alzheimer’s treatments only temporarily
relieve symptoms and while one treatment has been shown to slow the progression of the disease, none has been shown to halt the progression
of the disease, which currently affects roughly 7.2 million Americans; that number is expected to grow to 13 million individuals by 2050.
Alzheimer’s also impacts more than 11 million Americans who provide an estimated 19 billion hours of unpaid care per year, according
to data provided by the Alzheimer’s Association. In 2025, the estimated healthcare costs for treating individuals with Alzheimer’s
in the U.S. will be $384 billion, including $246 billion in Medicare and Medicaid payments. These costs could rise to as high as $1 trillion
per year by 2050 if no permanent treatment or cure for Alzheimer’s is found, according to the Alzheimer’s Association.
Our pipeline consists of two
novel therapeutic drug candidates:
Our
most advanced product candidate (lead product), which is licensed and in clinical development in humans, is AL001, an ionic cocrystal
of lithium for the treatment of Alzheimer’s, BD, MDD and PTSD. Based on our preclinical data involving mice models, AL001 treatment
prevented cognitive deficits, depression and irritability and is superior in improving associative learning and memory and irritability
compared with lithium carbonate treatments, supporting the potential of AL001 for the treatment of Alzheimer’s, BD, MDD and PTSD
in humans. Lithium was the first mood stabilizer approved by the U.S. Food and Drug Administration (“FDA”) and is still a
first-line treatment option (considered the “gold standard”) for BD and is prescribed off-label for MDD and PTSD. Moreover,
lithium has been marketed for more than 55 years and human toxicology regarding its use has been well characterized, potentially mitigating
the regulatory burden for safety data.
The
results of randomized, placebo-controlled, clinical trials of lithium in the treatment of patients with Alzheimer’s dementia and
subjects with mild cognitive impairment have been widely published. Clinical studies have indicated that lithium administered at doses
lower than those used for affective disorders can favorably impact Alzheimer’s outcomes. A study by O.V. Forlenza, et al., entitled
“Disease-Modifying Properties of Long-Term Lithium Treatment for Amnestic Mild Cognitive Impairment: Randomized Controlled Trial,”
which appeared in the British Journal of Psychiatry (2011), reported that lithium was superior to a placebo, evidencing a slower decline
of cognitive function as measured by the Alzheimer’s Disease Assessment Scale cognitive subscale. Given the absence of adequate,
widely adopted treatments that can slow, halt or even reverse the decline of this highly prevalent disease, the potential efficacy of
lithium in the long-term management of Alzheimer’s may positively impact public health. There is an unmet medical need for safe
and effective Alzheimer’s treatments, particularly for treatments with neuroprotective properties.
There
is increasing evidence to suggest that depressive illness, particularly in the elderly, is associated with neuronal cell loss. These findings
suggest that lithium may exert some long-term beneficial effects in the treatment of affective disorders via underappreciated neuroprotective
effects. Molecular biology and animal studies have also indicated that lithium may offer protection against Alzheimer’s. Given the
absence of other adequate treatments, we believe that research and commercialization of the potential efficacy of lithium in the long-term
treatment of neurodegenerative disorders is well worth pursuing.
Our Business Strategy
We intend to develop and commercialize
therapeutics that are better than existing treatments and have the potential to significantly improve the lives of individuals afflicted
by Alzheimer’s, BD, MDD and PTSD. To achieve these goals, we are pursuing the following key business strategies:
Our Development Pipeline
The
following chart provides an overview of the current development stages of our product candidates.
Our
product candidates will require extensive clinical evaluation, regulatory review and approval, significant marketing efforts and substantial
investment before either of them or any successors are likely to provide us with any revenue. As a result, if we do not successfully develop,
achieve regulatory approval for and commercialize our product candidates, our long-term business objectives will not materialize, and
we will be unable to generate the revenue we have forecast in the foreseeable future, if at all. We do not anticipate that we will generate
our maximum revenue for several years, or that we will achieve profitability for any of our therapeutic drug candidates until at least
a few years after generating material revenue, if at all. If we are unable to generate revenue or raise substantial additional capital,
we will not be able to pursue any expansion of our business or acquire additional intellectual property, we will never become profitable,
and we will be unable to continue our operations at the currently planned pace, if at all.
AL001 Drug Candidate
Our
lead product candidate that we have licensed and begun clinical development of in humans is an ionic cocrystal of lithium for the treatment
of Alzheimer’s, BD, MDD and PTSD. Lithium salts have a long history of human consumption beginning in the 1800s. In psychiatry,
they have been used to treat mania and as a prophylactic for depression since the mid-20th century. Today, lithium salts are used as a
mood stabilizer for the treatment of BD. Although the FDA has approved no medications as safe and effective treatments for suicidality,
lithium has proven to be the only drug that consistently reduces suicidality in patients with neuropsychiatric disorders. Despite these
effective medicinal uses, current FDA-approved lithium pharmaceutics (lithium carbonate and lithium citrate) are limited by a narrow therapeutic
window that requires regular blood monitoring of plasma lithium levels and blood chemistry by a clinician to mitigate adverse events.
Because conventional lithium salts (carbonate and citrate) are eliminated relatively quickly, multiple administrations throughout the
day are required to safely reach therapeutic plasma concentrations. Existing lithium drugs, such as lithium chloride and lithium carbonate,
suffer from chronic toxicity, poor physicochemical properties, and poor brain bioavailability. Because lithium is so effective at reducing
manic episodes in patients with BD, it is still used clinically despite its narrow therapeutic index. This has led researchers to begin
to look for other treatment methods than lithium but that may evince similar bioactivities.
Scientists
from the University of South Florida have developed a new lithium cocrystal composition and method of preparation that, under certain
clinical and/or testing conditions, have been shown to allow for lower dosages to achieve therapeutic brain levels of lithium for psychiatric
disorders, which could lead to a broadening of lithium’s therapeutic index. Our studies and tests have indicated that the compound
offers improved physiochemical properties compared to existing forms of lithium, giving it the potential to be developed as an anti-suicidal
drug and for use against mood disorders.
Recent
evidence suggests that lithium may be efficacious for both the treatment and prevention of Alzheimer’s. Unlike traditional medications,
which only address a single therapeutic target, lithium appears to be neuroprotective through several modes of action. For example, recent
studies have indicated that it exerts neuroprotective effects, in part, by increasing a brain-derived neurotrophic factor leading to restoration
of learning and memory. Another neuroprotective mechanism of lithium indicated by recent studies is the attenuation of the production
of inflammatory cytokines like IL-6 and nitric oxide in activated microglia. Results from recent clinical studies suggest that lithium
treatment may reduce the progression of dementia while preserving cognitive function and reducing biomarkers associated with Alzheimer’s.
AL001,
the novel ionic cocrystal of lithium, which was designed, synthesized and characterized by a team of inventors from the University of
South Florida, has been shown to exhibit improved nonclinical pharmacokinetics compared to currently available FDA-approved lithium products
and is also bioactive in many in vitro models of Alzheimer’s. AL001 may constitute a means of treating Alzheimer’s, BD, MDD
and PTSD.
We
believe that our ability to re-engineer lithium in solid dosage forms in order to optimize performance has the potential to address a
wide range of clinical applications beyond neurodegenerative disorders other than Alzheimer’s, but also amyotrophic lateral sclerosis
(known as ALS and popularly referred to as Lou Gehrig’s disease), Huntington’s disease, multiple sclerosis, Parkinson’s
disease and traumatic brain injury, to more psychiatric conditions such as BD, MDD, mania, PTSD and suicidality. This novel approach is
intended to achieve the desired therapeutic outcome of enhanced penetration through the blood-brain barrier and sustained brain lithium
concentrations while systemic exposures (and toxicities) are mitigated for other organ systems. The optimal modified-release lithium dosing
approach for AL001 should avoid acutely toxic peak concentrations in blood, as well as in the brain, and should maintain such relatively
minor blood concentrations for a predictable, clinically relevant time, with overall low systemic exposures that mitigate the potential
for adverse events. We anticipate that the lithium delivery system will be adaptable to a dosing regimen that maintains therapeutic brain
lithium concentrations consistently for the longest possible time while allowing only modest exposures and providing adequate recovery
periods between doses for other organ systems.
Clinical Trials
Phase I Study
On September 13, 2021, we initiated a randomized, balanced, Phase I,
single-dose, open-label, two-treatment, two-period, two- sequence, crossover, relative bioavailability clinical trial to investigate lithium
pharmacokinetics and safety of AL001 formulation compared to a marketed immediate release lithium carbonate formulation in healthy subjects.
The primary objective of this clinical trial was to assess the relative bioavailability of the AL001 lithium formulation relative to a
marketed lithium carbonate formulation in healthy subjects for the purpose of determining potential clinically safe and effective AL001
dosing in future studies. Additionally, we wanted to characterize safety and tolerability of the tested formulations under the conditions
of this clinical trial. This was a first-in-human clinical trial of the AL001 formulation and this trial was designed to assess the relative
bioavailability of the AL001 lithium formulation compared to a marketed lithium carbonate formulation in at least 24 completed healthy
subjects (30 subjects were to be enrolled) for the purpose of determining potential clinically safe and effective AL001 dosing in future
clinical trials. The AL001 lithium content was nearly half of the reference lithium carbonate capsule dosage as it was expected that treatment
of frail Alzheimer’s patients will require half the lithium dose used for treatment of BD. Lithium carbonate 300 mg (Reference product)
was given as a single dose in this clinical trial; this is often used as a starting dose for treatment of BD when given three times daily.
The shape of the AL001 lithium plasma concentration versus time curve was unknown prior to this study. Also unknown were the rate and
extent of lithium absorption of AL001. The Phase I study was completed in March 2022 with the following results:
· AL001 was shown to be safe and well-tolerated in healthy adult subjects;
· No deaths or serious adverse events were reported during the trial;
Phase IIA Study
On May 5, 2022, we initiated
a multiple-dose, steady-state, double-blind, ascending dose safety, tolerability, pharmacokinetic clinical trial (www.clinicaltrials.gov,
identifier: NCT05363293) of AL001 in patients with mild to moderate Alzheimer’s and healthy subjects with the following objectives:
o Facilitate recruitment into subsequent AL001 clinical trials; and
We completed the Phase IIA
clinical trial in March 2023, announced positive topline data in June 2023 and announced full data sets in October 2024. We successfully
identified an MTD for development of AL001 from a multiple-ascending dose study as assessed by an independent safety review committee.
This dose, providing lithium at a lithium carbonate equivalent dose of 240 mg 3-times daily (“TID”), is designed to be unlikely
to require lithium TDM. Also, the risk of this MTD is mitigated for the purpose of treating fragile populations, such as Alzheimer’s
patients.
Lithium is a commonly prescribed
drug for manic episodes in BD type 1 as well as maintenance therapy of BP in patients with a history of manic episodes. Lithium is also
prescribed off-label for MDD, BD and treatment of PTSD, among other disorders. Lithium was the first mood stabilizer approved by the FDA
and is still a first-line treatment option (considered the “gold standard”) but is underutilized, at least in part because
of the need for TDM. Lithium was the first drug that required TDM by regulatory authorities in product labelling because the effective
and safe range of therapeutic drug blood concentrations is narrow and well defined for treatment of BP when using lithium salts. Excursions
above this range can be toxic, and dosages below it can impair effectiveness.
Current and Future Phase II Studies
In August 2024, we announced
a partnership with MGH and Harvard Medical School to conduct five Phase II imaging clinical trials. The purpose of these trials is to
assess the comparative increase in lithium levels within the brain and its structures as opposed to a commonly marketed lithium salt among
healthy subjects and patients afflicted with Alzheimer’s, BD, MDD and PTSD.
In November 2024, we announced
a full data set from a nonclinical study comparing brain and plasma lithium exposures between AL001 and lithium carbonate in Alzheimer’s
transgenic mice. This study was a precursor to the five clinical trials and showed that AL001 exhibited consistently higher lithium concentrations
in brain tissues, particularly at lower doses, compared to lithium carbonate.
For these clinical trials,
we partnered with Tesla Dynamic Coils BV to create a head coil to enable whole-brain imaging of lithium with remarkable resolution, allowing
precise quantification within brain structures. The coil will be used to help identify the disease-specific target doses of AL001 that
improve the balance of safety and efficacy compared to lithium carbonate. The coil will also be used to scan the entire brain, helping
us clearly identify the different structures and important areas necessary for understanding how lithium works and moves within the brain.
We announced completion of the head coil in February 2025.
In May 2025, we announced
the initiation, enrollment and dosing of the first patient for the healthy human patients. This clinical trial has the following objectives:
We expect to present topline
data from this study by the end of 2025. Following completion of this clinical trial, we intend to initiate four more identical clinical
trials, with the first of these trials, for treatment of patients with BD, expected to commence in the third quarter of 2025. We anticipate
launching the clinical trial for patients with bipolar disorder (BD) in the fourth quarter of 2025, followed by clinical trials for major
depressive disorder (MDD) and post-traumatic stress disorder (PTSD) patients in the first quarter of 2026. Subsequently, the clinical
trial for Alzheimer’s patients is expected to commence in the second quarter of 2026. These projected timelines reflect our commitment
to advancing our clinical development programs across multiple neuropsychiatric and neurodegenerative indications.
ALZN002 Drug Candidate
The other product candidate
that we have obtained a license to clinically develop in humans is ALZN002, a patented method using a mutant peptide sensitized cell as
a cell-based therapeutic vaccine which seeks to restore the ability of the patient’s immunological system to combat Alzheimer’s.
The proposed mechanism of action is through the pulsed-Dendritic Cell (“DC”) activation of T-cells that stimulates the immune
system, resulting in the clearance of brain amyloid. Preclinical studies conducted from April 2005 to July 2010 demonstrated that the
infusion of transgenic (or genetically modified) mice with ALZN002-pulsed DCs is associated with lower amyloid burden and improved neuro-behavioral
performance. This is likely to be mediated by an anti-inflammatory effect in addition to the immunogenicity of this therapy.
The development of ALZN002
is predicated on the theory that Alzheimer’s symptoms may be caused in large part by plaque deposits that can cluster in the brain
composed of protein fragments called beta-amyloids that build up between nerve cells. One hypothesis is that a special type of immune
cell, a natural beta-amyloid antibody, may play a role in preventing plaque build-up in people without Alzheimer’s. As people age,
their immune systems tend to degrade, and some people may be unable to produce natural beta-amyloid antibodies, the absence of which leads
to the plaque build-up causing Alzheimer’s.
ALZN002
is intended to elicit an immune response to produce anti-amyloid antibodies, which can then neutralize circulated beta-amyloids and prevent
additional plaque build-up. The mutant antigen within ALZN002 was selected specifically for its high human leukocyte antigens binding
affinity, thereby avoiding the need for an adjuvant, which may cause an adverse (Th1) immune response.
ALZN002
is an autologous modified DC treatment. More precisely, it is a patient-specific therapy where the patient undergoes leukapheresis, a
nonsurgical treatment used to reduce the quantity of white blood cells in the bloodstream, to isolate peripheral blood monocytes that
are subsequently matured into DCs using cytokine therapy (IL4+ GM-CSF) cocktail. The DCs are incubated with a modified amyloid beta (Aβ)
peptide to sensitize them, and then administered to the same patient.
Significant
evidence has accumulated recently suggesting that immunotherapy is a highly promising modality of treatment in Alzheimer’s. Most
current immune-based active investigations are focused on passive immunization by pre-prepared Aβ antibody administration. Active
immunization may offer additional or more lasting effects on the clearance of amyloid and a safer approach due to its reliance on autologous
immune mechanisms. Further, preliminary evidence suggests a recurrence of the amyloid accumulation after clearance with the immunoglobulins.
A prior attempt at engaging the immune system to treat Alzheimer’s was conducted using the immunization with pre-aggregated synthetic
Aβ (AN-1792) combined with the immunogenic adjuvant QS-21. The Phase IIA study with AN-1792 was terminated by the FDA due to severe
meningoencephalitis in approximately 6% of vaccinated subjects. We believe that this may have been caused by using a QS-21 adjuvant in
the vaccine formulation, which we will not use
Clinical Trials
Pre-Clinical
On July 23, 2021, we announced
that Alzamend received positive toxicology results for ALZN002 in a good laboratory practices (“GLP”) toxicology study using
a transgenic mouse model of Alzheimer’s. The study was conducted by Charles River Laboratories. ALZN002 is a patented method using
a mutant-peptide sensitized cell as a cell-based therapeutic vaccine that seeks to restore the ability of a patient’s immunological
system to combat Alzheimer’s.
A
five-dose GLP study with ALZN002-sensitized cells was completed using a transgenic mouse model of Alzheimer’s to investigate the
tolerability of ALZN002. Single injections were administered on days 1, 30, 50, 70, and 90. The mice were evaluated for potential toxicity
and reversibility of any findings at 75 and 90 days after the final dosing.
Histopathology
results demonstrate that there was no indication of T-cell infiltration or meningoencephalitis, which suggests that ALZN002 therapy is
safe and tolerable as there were no adverse findings over a 90-day period or 90 days after the last dose. There were no treatment-related
mortalities or reports of adverse effects on clinical observations, body weight parameters, organ weight parameters, clinical pathology
parameters, gross pathology observations, or histopathologic observations during the main study or the recovery phase.
Modified cell therapies, especially
DCs, may provide a safer and more patient-specific active immunization. Ex-vivo modification of DCs as a modality of treatment has been
previously used in oncological therapeutics. It has been shown to be relatively safe and capable of engaging the immune system to attack
the target tissues with success. Its use in Alzheimer’s therapeutics is relatively recent.
Phase I/II Study
We submitted a pre-IND meeting
request for ALZN002 and supporting briefing documents to the Center for Biological Evaluation and Research of the FDA on July 30, 2021.
We received a written response relating to the pre-IND from the FDA providing a path for Alzamend’s planned clinical development
of ALZN002 on September 30, 2021. The FDA agreed to allow Alzamend to submit an IND to conduct a combined Phase I/II study.
On
September 28, 2022, we submitted an IND to the FDA for ALZN002 and received a “study may proceed” letter on October 31, 2022.
The product candidate is an immunotherapy vaccine designed to treat mild to moderate dementia of the Alzheimer’s type. ALZN002 is
a proprietary “active” immunotherapy product, which means it is produced by each patient’s immune system. It consists
of autologous DCs consisting of activated white blood cells taken from each individual patient so that they can be engineered outside
of the body to attack Alzheimer’s-related amyloid-beta proteins. These DCs are pulsed with a novel amyloid-beta peptide (E22W) designed
to bolster the ability of the patient’s immune system to combat Alzheimer’s; the goal is to foster tolerance to treatment
for safety purposes while stimulating the immune system to reduce the brain’s beta-amyloid protein burden, resulting in reduced
Alzheimer’s signs and symptoms. Compared to passive immunization treatment approaches that use foreign blood products (such as monoclonal
antibodies), active immunization with ALZN002 is anticipated to offer a more robust and long-lasting effect on the clearance of amyloid.
This approach could prove safer due to its reliance on autologous immune components, using each individual patient’s own white blood
cells rather than foreign cells and/or blood products.
On April 3, 2023, we announced
the initiation of a Phase I/IIA clinical trial for ALZN002 to treat mild to moderate dementia of the Alzheimer’s type. The purpose
of this trial is to assess the safety, tolerability, and efficacy of multiple ascending doses of ALZN002 compared with that of a placebo
in 20-30 subjects with mild to moderate morbidity. The primary goal of this clinical trial is to determine an appropriate dose of ALZN002
for treatment of patients with Alzheimer’s in a larger Phase IIB efficacy and safety clinical trial. In February 2024, we received
notice from Biorasi, our CRO, that Biorasi was terminating our contract with it. We are currently pursuing the engagement of a replacement
CRO. Due to the scientific and operational complexities of the ALZN002 trial, along with the limited number of CROs with the expertise
and capacity to complete the trial, we have experienced a delay in engaging a new CRO. We do not expect to resume this trial until mid-2026.
Intellectual Property and Licensing Agreements
On July 2, 2018, we entered
into two Standard Exclusive License Agreements with Sublicensing Terms for AL001 with the Licensor and its affiliate, the University of
South Florida (the “AL001 Licenses”), pursuant to which the Licensor granted us a royalty bearing exclusive worldwide licenses
limited to the field of Alzheimer’s, under U.S. Patent Nos. (i) 9,840,521, entitled “Organic Anion Lithium Ionic Cocrystal
Compounds and Compositions,” filed September 24, 2015 and granted December 12, 2017, and (ii) 9,603,869, entitled “Lithium
Co-Crystals for Treatment of Neuropsychiatric Disorders,” filed May 21, 2016 and granted March 28, 2017. On February 1, 2019, we
entered into the First Amendments to the AL001 Licenses, on March 30, 2021, we entered into the Second Amendments to the AL001 Licenses
and on June 8, 2023, we entered into the Third Amendments to the AL001 Licenses (collectively, the “AL001 License Agreements”).
The Third Amendments to the AL001 Licenses modified the timing of the payments for the license fees.
The AL001 License Agreements
require that we pay combined royalty payments of 4.5% on net sales of products developed from the licensed technology for AL001. We have
already paid an initial license fee of $200,000 for AL001. As an additional licensing fee for the license of the AL001 technologies, the
Licensor received 14,853 shares of our common stock. Minimum royalties for AL001 License Agreements are $40,000 on the first anniversary
of the first commercial sale, $80,000 on the second anniversary of the first commercial sale and $100,000 on the third anniversary of
the first commercial sale and every year thereafter, for the life of the AL001 License Agreements.
On May 1, 2016, we entered
into a Standard Exclusive License Agreement with Sublicensing Terms for ALZN002 with the Licensor (the “ALZN002 License”),
pursuant to which the Licensor granted us a royalty bearing exclusive worldwide license limited to the field of Alzheimer’s Immunotherapy
and Diagnostics, under U.S. Patent No. 8,188,046, entitled “Amyloid Beta Peptides and Methods of Use”, filed April 7, 2009
and granted May 29, 2012. On August 18, 2017, we entered into the First Amendment to the ALZN002 License, on May 7, 2018, we entered into
the Second Amendment to the ALZN002 License, on January 31, 2019, we entered into the Third Amendment to the ALZN002 License, on January
24, 2020, we entered into the Fourth Amendment to the ALZN002 License, on March 30, 2021, we entered into the Fifth Amendment to the ALZN002
License, on April 17, 2023, we entered into the Sixth Amendment to the ALZN002 License and on December 11, 2023, we entered into the Seventh
Amendment to the ALZN002 License (collectively, the “ALZN002 License Agreement”). The Seventh Amendment to the ALZN002 License
modified the timing of the payments for the license fees.
The ALZN002 License Agreement
requires us to pay royalty payments of 4% on net sales of products developed from the licensed technology for ALZN002. We have already
paid an initial license fee of $200,000 for ALZN002. As an additional licensing fee for the license of ALZN002, the Licensor received
24,012 shares of our common stock. Minimum royalties for ALZN002 are $20,000 on the first anniversary of the first commercial sale, $40,000
on the second anniversary of the first commercial sale and $50,000 on the third anniversary of the first commercial sale and every year
thereafter, for the life of the ALZN002 License Agreement.
On November 19, 2019, we entered
into two Standard Exclusive License Agreements with Sublicensing Terms for two additional indications of AL001 with the Licensor (the
“November AL001 License”), pursuant to which the Licensor granted us a royalty bearing exclusive worldwide license limited
to the fields of (i) neurodegenerative diseases excluding Alzheimer’s and (ii) psychiatric diseases and disorders. On March 30,
2021, we entered into the First Amendments to the November AL001 License and on April 17, 2023, we entered into the Second Amendments
to the November AL001 License (collectively, the “November AL001 License Agreements”). The Second Amendments to the November
AL001 License modified the timing of the payments for the license fees.
The November AL001 License
Agreements require us to pay royalty payments of 3% on net sales of products developed from the licensed technology for AL001 in those
fields. We paid an initial license fee of $20,000 for the additional indications. Minimum royalties for November AL001 License Agreements
are $40,000 on the first anniversary of the first commercial sale, $80,000 on the second anniversary of the first commercial sale and
$100,000 on the third anniversary of the first commercial sale and every year thereafter, for the life of the November AL001 License Agreements.
These license agreements have
an indefinite term that continue until the later of the date that no licensed patent under the applicable agreement remains a pending
application or enforceable patent, the end date of any period of market exclusivity granted by a governmental regulatory body, or the
date on which the licensee’s obligations to pay royalties expire under the applicable license agreement. Under our various license
agreements, if we fail to meet a milestone by its specified date, Licensor may terminate the license agreement. The Licensor was also
granted a preemptive right to acquire such shares or other equity securities that may be issued from time to time by us while the Licensor
remains the owner of any equity securities of our company.
Additionally, we are required
to pay milestone payments on the due dates to the Licensor for the license of the AL001 technologies and for the ALZN002 technology, as
follows:
Original AL001 Licenses:
Payment Due Date
$ 50,000* Pre-IND Meeting - Completed September 2019
$ 65,000* IND application filing - Completed June 2021
$ 500,000* Upon completion of first clinical trial - Completed March 2022
$ 1,250,000 Upon first patient treated in a Phase III clinical trial
* Milestone met and completed
ALZN002 License:
Payment Due Date
$ 50,000* Upon IND application - Completed January 2022
$ 50,000 Upon first dosing of patient in first Phase I clinical trial
$ 500,000 Upon completion of first Phase IIB clinical trial
$ 1,000,000 Upon first patient treated in a Phase III clinical trial
* Milestone met and completed
Additional AL001 Licenses:
Payment Due Date
$ 2,000,000 Upon first patient treated in a Phase III clinical trial
Market Opportunity
According
to the National Institute of Health (“NIH”), there are more than 48.2 million Americans afflicted with Alzheimer’s,
BD, MDD or PTSD. The rise in the prevalence of these disorders and the associated risks arising therefrom, such as high stress, substance
abuse, and advancements in a combination of drugs are primarily propelling market growth. Advancements in technology allowing more accurate
diagnosis/detection of Alzheimer’s, BD, MDD, and PTSD are also positively influencing market growth. Other factors, such as increasing
research and development activities (via clinical trials) and investments by the government to improve the healthcare industry, are expected
to further drive market growth. Additionally, increased awareness about Alzheimer’s, BD, MDD and PTSD via the various disease/disorder-specific
non-profit organizations is accelerating market growth. The potential marketplace for a commercialized therapy or treatment would be tremendously
significant with large financial support available from numerous national and international pharmaceutical companies and various governments
and worldwide agencies. We were founded with a mission to further develop AL001 and ALZN002, by funding them through human clinical trials
administered by the FDA and ultimately, if successful, making them available to the public.
Industry Overview
Alzheimer’s
Currently,
Alzheimer’s is the seventh leading cause of death in the U.S. and, when extrapolated globally, the market for preventions, treatments
and cures of this crippling disease is massive. Since 1990, life expectancy has increased by six years and the worldwide average continues
to increase. With the increase in the mean age of the population in developed countries, the prevalence of deteriorating neurological
diseases has also increased. According to the Alzheimer’s Association, in the U.S. alone, one of nine persons older than 65 has
Alzheimer’s, with roughly 7.2 million Americans currently living with it. It is estimated that this number will grow to 13 million
by 2050 barring the development of medical breakthroughs to prevent, slow or cure the disease. Many Alzheimer’s related associations
believe the actual number of adults with Alzheimer’s may be much higher since current statistics do not account for deaths from complications
or from related diseases like pneumonia or heart attack. These death certificates only list the most immediate cause. The fastest growing
age group in the U.S. is the “over 85” group within which one in three individuals has Alzheimer’s.
It is estimated that the cost
of caring for people with Alzheimer’s and other dementias will increase from an estimated $384 billion in 2025 to a projected $1
trillion per year by 2050 with Medicare and Medicaid covering approximately 70% of such costs. Over 12 million Americans provide unpaid
care for people with Alzheimer’s or other dementias. The Alzheimer’s Association estimated that, in 2024, caregivers to individuals
with Alzheimer’s provided 19 billion hours of care valued at $413 billion.
Alzheimer’s Therapeutic Landscape
There are currently several
experimental therapeutic agents for Alzheimer’s in various stages of development with clinical testing directed towards amyloid-beta,
or Aβ, clearance, and inhibition of Tau protein aggregation or phosphorylated-Tau, or pTau, clearance. In June 2021, the FDA approved
Biogen’s Alzheimer’s drug aducanumab, also known as Aduhelm, making it the first medication cleared by U.S. regulators to
reduce amyloid plaques in people living with Alzheimer’s and the first new medication for the disease in nearly two decades. There
were previously no drugs cleared by the FDA that can slow the mental decline caused by Alzheimer’s, which is the seventh-leading
cause of death in the U.S. In July 2023, an anti-beta amyloid antibody known as Lecanemab-irmb (“Leqembi”), received full
approval by FDA for treatment of Alzheimer’s. In July 2024, the FDA approved Eli Lilly’s Alzheimer’s drug donanemab,
also known as Kisunla, which targets amyloid in the brain. Given the current weight of evidence, amyloid is now established as a cause
of Alzheimer’s.
Both Leqembi and Kisunla are
humanized monoclonal antibodies that bind with high affinity to soluble amyloid-beta oligomers, which reportedly are toxic to neurons.
Both Leqembi and Kisunla reduced biomarkers of amyloid in early Alzheimer’s and resulted in moderately less decline in measures
of cognition and function compared to placebo at 18 months. Since Leqembi and Kisunla only provide passive immunity, antibody infusions
are needed every 2 or 4 weeks, respectively. Both Leqembi and Kisunla support and validate the amyloid theory, but in routine medical
practice there will be a large burden on the health care system due to the need for bi-weekly or monthly infusions.
Bipolar Disorder
BD,
previously known as manic depression, is a mood disorder characterized by periods of depression and periods of abnormally elevated happiness
that each lasts from days to weeks. If the elevated mood is severe or associated with psychosis, it is called mania; if it is less severe,
it is called hypomania. During mania, an individual behaves or feels abnormally energetic, happy, or irritable, and they often make impulsive
decisions with little regard for the consequences. There is usually also a reduced need for sleep during manic phases. During periods
of depression, the individual may experience crying and have a negative outlook on life and poor eye contact with others. The risk of
self-abuse and even suicide is high; over a period of 20 years, 6% of those with BD died by suicide, while 30–40% engaged in self-harm.
Other mental health issues, such as anxiety disorders and substance use disorders, are commonly associated with BD.
While
the causes of BD are not clearly understood, both genetic and environmental factors are thought to play a role. Many genes, each with
small effects, may contribute to the development of the disorder. Genetic factors account for about 70–90% of the risk of developing
BD. Environmental risk factors include a history of childhood abuse and long-term stress. The condition is classified as bipolar I disorder
if there has been at least one manic episode, with or without depressive episodes, and as bipolar II disorder if there has been at least
one hypomanic episode (but no full manic episodes) and one major depressive episode. If these symptoms are due to drugs or medical problems,
they are not diagnosed as BD. Other conditions that have overlapping symptoms with BD include attention deficit hyperactivity disorder,
personality disorders, schizophrenia, and substance use disorder as well as many other medical conditions. Medical testing is not required
for a diagnosis, though blood tests or medical imaging can rule out other problems.
BD
occurs in approximately 1% of the global population. According to the NIH, roughly seven million Americans are estimated to be affected
at some point in their lives; rates appear to be similar in men and women. Symptoms most commonly begin between the ages of 20 and 25
years old; an earlier onset in life is associated with a worse prognosis. Interest in functioning in the assessment of patients with BD
is growing, with an emphasis on specific domains such as work, education, social life, family and cognition. Around one-quarter to one-third
of people with BD have financial, social or work-related problems due to the illness. BD is among the top 20 causes of disability worldwide
and leads to substantial costs for society. Due to lifestyle choices and the side effects of medications, the risk of death from natural
causes such as coronary heart disease in people with BD is twice that of the general population.
Bipolar Disorder Therapeutic Landscape
Mood
stabilizers, including lithium and certain anticonvulsants, such as valproate and carbamazepine, as well as atypical antipsychotics, such
as aripiprazole, are the mainstay of long-term pharmacologic relapse prevention. Antipsychotics are additionally given during acute manic
episodes as well as in cases where mood stabilizers are poorly tolerated or ineffective. In patients where compliance is of concern, long-acting
injectable formulations are available. There is some evidence that psychotherapy improves the course of BD. The use of antidepressants
in depressive episodes is controversial; they can be effective but have been implicated in triggering manic episodes. The treatment of
depressive episodes, therefore, is often difficult. Electroconvulsive therapy (“ECT”) is effective in acute manic and depressive
episodes, especially with psychosis or catatonia. Admission to a psychiatric hospital may be required if a person is a risk to themselves
or others; involuntary treatment is sometimes necessary if the affected person refuses treatment.
Major Depressive Disorder
MDD, also known simply as
depression, is a mental disorder characterized by at least two weeks of pervasive low mood, low self-esteem, and loss of interest or pleasure
in normally enjoyable activities. Those affected may also occasionally have delusions or hallucinations. Introduced by a group of U.S.
clinicians in the mid-1970s, the term was adopted by the American Psychiatric Association for this symptom cluster under mood disorders
in the 1980 version of the Diagnostic and Statistical Manual of Mental Disorders (DSM-III) and has become widely used since.
The diagnosis of MDD is based
on the person's reported experiences and a mental status examination. There is no laboratory test for the disorder, but testing may be
done to rule out physical conditions that can cause similar symptoms. The most common time of onset is in a person’s 20s, with women
affected about twice as often as men. The course of the disorder varies widely, from one-episode lasting months to a lifelong disorder
with recurrent major depressive episodes.
MDD
is believed to be caused by a combination of genetic, environmental, and psychological factors, with about 40% of the risk being genetic.
Risk factors include a family history of the condition, major life changes, certain medications, chronic health problems, and substance
use disorders. It can negatively affect a person's personal life, work life, or education as well as sleeping, eating habits, and general
health. According to the NIH, MDD affected approximately 21 million adults (8.4% of all U.S. adults) in 2020. The prevalence of adults
with a major depressive episode was higher among adult women (10.5%) than men (6.2%). The prevalence of adults with a major depressive
episode was highest among individuals aged 18-25 (17.0%). MDD causes the second-most years lived with disability, after lower back pain.
Major Depressive Therapeutic Landscape
Those with MDD are typically
treated with psychotherapy and antidepressant medication. Medication appears to be effective, but the effect may predominantly be significant
in the most severely depressed. Hospitalization (which may be involuntary) may be necessary in cases with associated self-neglect or a
significant risk of harm to self or others. ECT may be considered if other measures are not effective.
Although lithium does not
have an FDA approved indication for augmentation of an antidepressant in MDD, it has been prescribed off-label for this purpose for decades.
While a wide variety of medications have been used historically in this capacity, lithium is one of the few agents that has demonstrated
efficacy in multiple randomized controlled trials. Although the ideal role for lithium augmentation has yet to be established, there is
evidence to support the clinical practice of adding lithium to conventional antidepressants in pursuit of MDD remission. Lithium augmentation
has been cited as a main strategy for depressed patients not responding to an antidepressant, lithium prophylaxis for recurrent unipolar
depression as an alternative to prophylaxis with an antidepressant, and for lithium’s anti-suicidal properties, where appropriate.
Post-Traumatic Stress Disorder
PTSD
is a mental and behavioral disorder that can develop because of exposure to a traumatic event, such as sexual assault, warfare, traffic
collisions, child abuse, domestic violence, or other threats to a person’s life. Symptoms may include disturbing thoughts, feelings
or dreams related to the causal event, mental or physical distress to trauma-related cues, attempts to avoid trauma-related cues, alterations
in the way a person thinks and feels, and an increase in the fight-or-flight response. These symptoms may remain for more than a month
after the event. A person with PTSD is at a higher risk of suicide and intentional self-harm.
Most people who experience
traumatic events do not develop PTSD. People who experience interpersonal violence such as rape, other sexual assaults, being kidnapped,
stalking, physical abuse by an intimate partner, and incest or other forms of childhood sexual abuse are more likely to develop PTSD than
those who experience non-assault-based trauma, such as accidents and natural disasters. Those who experience prolonged trauma, such as
slavery, concentration camps, or chronic domestic abuse, may develop complex post-traumatic stress disorder (“C-PTSD”). C-PTSD
is similar to PTSD but has a distinct effect on a person's emotional regulation and core identity.
According
to the NIH, about 3.5%, or roughly nine million, adults in the U.S. have PTSD in a given year, and 9% of people develop it at some point
in their life. In much of the rest of the world, rates for a given year are between 0.5% and 1% of the population. Higher rates may occur
in regions of armed conflict. It is more common in women than men. PTSD was first mentioned in the American Psychiatric Association Diagnostic
and Statistical Manual of Mental Disorders (DSM-I) in the 1950s under the term “gross stress reaction.” Although this diagnosis
included psychological problems related to traumatic events such as wartime combat, it limited symptoms to six months. This diagnosis
was removed from the American Psychiatric Association Diagnostic and Statistical Manual of Mental Disorders (DSM-II) in 1968, representing
a regression in accurate PTSD characterization. The long-term psychological disabilities experienced by trauma survivors, including combat
veterans, sexual assault victims and Holocaust survivors led to the introduction of PTSD in the American Psychiatric Association Diagnostic
and Statistical Manual of Mental Disorders (DSM-III) in 1980 when, for the first time, the definition of PTSD highlighted the critical
connection between traumatic events and long-term psychological symptoms.
Post-Traumatic Stress Disorder Therapeutic
Landscape
Prevention may be possible
when counselling is targeted at those with early symptoms but is not effective when provided to all trauma-exposed individuals, whether
or not symptoms are present. The main treatments for people with PTSD are counselling (psychotherapy) and medication. Antidepressants
of the selective serotonin reuptake inhibitors (“SSRI”) or serotonin-norepinephrine reuptake inhibitors (“SNRI”)
type are the first-line medications used for PTSD and are moderately beneficial for about half of people. Benefits from medication are
less effective than those seen with counselling. It is not known whether using medications and counselling together have greater benefits
than either method separately.
Sertraline (Zoloft) and Paroxetine
(Paxil) are FDA-approved medications for PTSD. Reviews by a group of doctors of pharmacological monotherapy in 2015 and 2021 found that
paroxetine, fluoxetine, sertraline and venlafaxine could be effective for PTSD, but the magnitude of the effect was low and the clinical
relevance was unclear. These reviews excluded lithium treatments. Medications, other than some SSRIs or SNRIs, do not have enough evidence
to support their use and, in the case of benzodiazepines, may worsen outcomes.
Case reports suggest that
lithium treatment may be useful for irritability/anger outbursts in PTSD patients. For example, one study by Kitchner and Greenstein provided
case histories of four males (aged approximately 31–42 years) who suffered from PTSD resulting from their experiences in the Vietnam
War. Results from treatment with low doses (300–600 mg/day) of lithium carbonate were reported to indicate that treatment was effective
in reducing inappropriate anger, irritability, anxiety, and insomnia.
The clinical observation of
mood swings beyond the normal range but milder than those associated with BD reportedly suggested the presence of a subthreshold mood
disorder in these PTSD patients. It has also been proposed that treatment of trauma with lithium to forestall the development of PTSD
may be provided by pharmacological induction of a mild transient amnesia.
Manufacturing
Currently, we do not have
in-house manufacturing capabilities. We have outsourced and expect to continue to outsource the manufacturing of our products to third
party contractors with special capabilities to manufacture chemical drugs and biologic drug candidates for submission and clinical testing
under FDA guidelines and, for AL001 and ALZN002, have received Good Manufacturing Practices, or GMP, material manufactured for clinical
trial. There are several sources of manufacturing available once a therapy or treatment can achieve Phase II study as identified in a
publication by Pharma.org released in 2013 (http://www.phrma.org/sites/default/files/Alzheimer’s%202013.pdf).
Distribution and Marketing
We
intend to develop AL001 and ALZN002 through successive de-risking milestones towards regulatory approval and seek marketing approval of
AL001 and ALZN002 or enter into partnering transactions with biopharmaceutical companies seeking to strategically fortify pipelines and,