Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)

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

The following discussion and analysis of our financial conditions and results of operations should be read together with our consolidated financial statements and related notes appearing elsewhere in this Quarterly Report and our audited financial statements and notes thereto as of and for the years ended December 31, 2025 and 2024 and the related Management's Discussion and Analysis of Financial Condition and Results of Operations, included in our Annual Report filed with the Securities and Exchange Commission ("SEC"), on March 26, 2026. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions and other factors that could cause actual results to differ materially from those made, projected or implied in the forward-looking statements. Our actual results may differ materially from those discussed below. Please see "Special Note Regarding Forward-Looking Statements" and "Risk Factors" included in Part I, Item 1A of our Annual Report for factors that could cause or contribute to such differences.

Overview

We are a clinical-stage biopharmaceutical company engaged in the discovery and development of innovative, small molecule therapeutics targeting age-related degenerative diseases and disorders of the central nervous system ("CNS"). Currently available therapies for these diseases are limited, with few Alzheimer's disease ("AD") treatments, and no approved treatments for dementia with Lewy bodies ("DLB"). Our goal is to develop disease-modifying treatments for participants with these degenerative disorders.

Our lead product candidate, zervimesine, also known as CT1812, is an orally delivered, small molecule designed to protect neuronal synapses by preventing the binding of oligomers of pathogenic proteins including β-amyloid, or Aβ and ɑ-synuclein. These and similar protein oligomers have been linked to the progression of degenerative diseases such as AD, and DLB.

The United States Adopted Name (USAN) Council adopted zervimesine as the USAN for CT1812 in December 2024.

Enrollment concluded in December 2025 in the Phase 2 COG0203 (START) study of zervimesine in 545 patients with mild cognitive impairment (MCI) and early stage AD. Topline results are expected after all participants have completed 18 months of treatment. START has been funded by a grant of approximately $81 million awarded by the National Institute of Aging ("NIA"), a division of the National Institutes of Health ("NIH"). We are conducting the START clinical trial in collaboration with the Alzheimer's Clinical Trial Consortium ("ACTC"), an NIA-funded clinical trials network designed to accelerate studies for therapeutics for AD and related dementias.

The randomized, double-blind, placebo-controlled Phase 2 COG0201 (SHINE) trial enrolled 153 adults with mild-to-moderate Alzheimer's disease and met its primary endpoints of safety and tolerability. SHINE was funded by a grant of approximately $30.5 million awarded by the NIA. A prespecified analysis found that participants treated with zervimesine (pooled 100 mg and 300 mg) who had baseline levels of plasma p-tau217 below the median of 1.0 pg/mL experienced a 95% reduction of cognitive decline at week 26 as measured by ADAS-Cog 11 relative to placebo-treated participants. P-tau217 is an important biomarker that reflects total brain amyloid and tau pathology.

In July 2025, we conducted an end-of-Phase 2 meeting with the FDA to review results of the SHINE study and discuss proposed plans for a Phase 3 program designed to support regulatory approval of zervimesine in this patient population. FDA concurred with the proposed study design, which would randomize participants to 100 mg of oral zervimesine or placebo daily for at least six months. Primary outcomes would include a composite cognitive endpoint such as the integrated Alzheimer's Disease Rating Scale (iADRS) as well as a functional endpoint such as ADCS-ADL. The Phase 3 study population would be enriched with AD patients who have lower plasma p-tau217 at screening. Cognition has received and is reviewing scientific advice from the European Medicines Agency ("EMA") indicating a preference for a longer trial than was proposed.

The randomized, double-blind, placebo-controlled Phase 2 COG1201 (SHIMMER) study enrolled 130 adults with DLB and met its primary endpoint of safety and tolerability. SHIMMER was funded by a grant of approximately $30 million awarded by the NIA. Zervimesine treatment resulted in an 86% slowing of decline on NPI-12 vs placebo in the SHIMMER study. This tool describes the frequency and severity of 12 behavioral symptoms including hallucinations, delusions and anxiety.

In June 2025, the company initiated an expanded access program ("EAP") for 32 eligible participants who completed the Phase 2 SHIMMER study as well as additional patients with a diagnosis of mild-to-moderate DLB who met the criteria for this program. Through this open-label EAP (COG1202), participants are being provided with 100 mg of oral zervimesine to take daily for approximately one year. The first participant was enrolled in June 2025 and the last in December 2025.

In January 2026, the Company conducted a Type C meeting with the FDA, with a focus on identifying clinically meaningful endpoints for future DLB studies. Based on the FDA's feedback and the strength of its Phase 2 results, the company plans to develop zervimesine for DLB psychosis. Cognition is planning to meet with the FDA Division of Psychiatry in the second quarter 2026 to discuss a DLB psychosis program and align on study design.

Based on proteomic evidence generated from the Company's clinical programs in Alzheimer's disease and supported by in vitro findings, the company initiated the Phase 2 COG2201 (MAGNIFY) clinical study of zervimesine for the treatment of geographic atrophy secondary to dry AMD. Based on favorable results from the AD and DLB programs, and a desire to conserve company resources, the MAGNIFY study was voluntarily concluded in January 2025 after approximately 100 participants were enrolled, approximately half of whom received zervimesine for at least one year.

The above Overview covers only the most recently concluded studies in each indication. The following table highlights findings from these and subsequent studies:

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To date, we have funded our operations primarily with proceeds from grants awarded by the NIA, a division of the NIH, and proceeds from our initial public offering (the "IPO"), completed in October 2021, proceeds from our follow-on offerings, sales of our common stock through our at the market offerings, sales of our convertible promissory notes, convertible preferred stock, simple agreements for future equity ("SAFE") and stock option exercises. Since our inception, we have raised approximately $175.2 million in net proceeds from sales of our equity securities, convertible notes, SAFE, stock option exercises, IPO, follow-on public offerings, ATM, and equity line financing with Lincoln Park. As of March 31, 2026, we had cash, cash equivalents and restricted cash of $31.2 million. As of March 31, 2026, we had approximately $25.6 million available from obligated NIA funds for applicable expenses to be incurred in the future.

On August 29, 2025, we completed our registered direct offering, pursuant to which we issued and sold 14,700,000 shares of our common stock at an offering price of $2.05 per share. We received net proceeds of approximately $27.9 million, after deducting underwriting discounts, commissions, placement agent fees, and other offering related expenses payable by us. In connection with the registered direct offering, we agreed to pay the placement agent an aggregate cash fee of 7.0% of the gross proceeds raised from the sale and issuance of the shares of common stock minus certain expenses. We agreed to issue warrants to the placement agent to purchase up to 514,500 shares of common stock which have an exercisable price equal to $2.78 and will be exercisable commencing six months from the close of the registered direct offering with a term of five (5) years from the date of the Placement Agency Agreement.

On December 18, 2025, we filed a shelf registration statement with the SEC and a prospectus supplement, which registered the offering, issuance and sale of up to $300.0 million of various equity and debt securities and up to $75.0 million of common stock pursuant to an at-the-market equity offering program with Jefferies LLC ("Jefferies") (the "2025 ATM"). For the period ended March 31, 2026, we did not sell any shares of common stock pursuant to the 2025 ATM. As of March 31, 2026, $75.0 million remain in gross proceeds available for future issuances of common stock under the 2025 ATM.

We expect to continue to incur significant and increasing expenses and net losses for the foreseeable future, as we advance our current and future product candidates through preclinical and clinical development, manufacture drug product and drug supply, seek regulatory approval for our current and future product candidates, maintain and expand our intellectual property portfolio, hire additional research and development and business personnel and operate as a public company. We will not generate revenue from product sales unless and until we successfully complete clinical development and obtain regulatory approval for our product candidates. In addition, if we obtain regulatory approval for our product candidates and do not enter into a third-party commercialization partnership, we expect to incur significant expenses related to developing our commercialization capability to support product sales, marketing, manufacturing and distribution activities.

As a result, we will need substantial additional funding to support our continuing operations and pursue our growth strategy. Until we can generate significant revenue from product sales, if ever, we expect to finance our operations through a combination of public or private equity offerings, debt financings or other sources, such as potential collaboration agreements and strategic alliances, licensing or similar arrangements with third parties.

Because of the numerous risks and uncertainties associated with product development, we are unable to accurately predict the timing or amount of increased expenses or when, or if, we will be able to achieve profitability. Even if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. If we fail to become profitable or are unable to sustain profitability on a continuing basis, then we may be unable to raise capital, maintain our research and development efforts, expand our business or continue our operations at planned levels, and as a result we may be forced to substantially reduce or terminate our operations.

We do not own or operate manufacturing facilities. We rely, and expect to continue to rely, on third parties for the manufacture of zervimesine for preclinical studies and clinical trials, as well as for commercial manufacture if zervimesine obtains marketing approval. We also rely, and expect to continue to rely, on third parties to manufacture, package, label, store, and distribute zervimesine, if marketing approval is obtained. We believe that this strategy allows us to maintain a more efficient infrastructure by eliminating the need for us to invest in our own manufacturing facilities, equipment, and personnel while also enabling us to focus our expertise and resources on the development of zervimesine.

Components of Our Results of Operations

Operating Expenses

Research and Development Expenses

Research and development expenses consist primarily of direct and indirect costs incurred for our research activities, including development of our drug discovery efforts and the development of our product candidates. Direct costs include laboratory materials and supplies, contracted research and manufacturing, clinical trial costs, consulting fees, and other expenses incurred to sustain our research and development program. Indirect costs include personnel-related expenses, consisting of employee salaries, related benefits, and stock-based compensation expense for employees engaged in research and development activities, facilities, and other expenses consisting of direct and allocated expenses for rent and depreciation, and lab consumables.

We expense research and development costs as incurred. Non-refundable advance payments for goods and services that will be used over time for research and development are capitalized and recognized as goods are delivered or as the related services are performed. In-licensing fees and other costs to acquire technologies used in research and development that have not yet received regulatory approval and that are not expected to have an alternative future use are expensed when incurred. We track direct costs by stage of program, clinical or preclinical. However, we do not track indirect costs on a program specific basis because these costs are deployed across multiple programs and, as such, are not separately classified.

We cannot reasonably determine the nature, timing, and estimated costs of the efforts that will be necessary to complete the development of, and obtain regulatory approval for, any of our product candidates. Product candidates in later stages of development generally have higher development costs than those in earlier stages. We expect that our research and development expenses will increase substantially for the foreseeable future as we continue to invest in research and development activities related to developing our product candidates, as our product candidates advance into later stages of development, as we begin to conduct larger clinical trials, as we seek regulatory approvals for any product candidates that successfully complete clinical trials, as we expand our product pipeline, as we maintain, expand, protect and enforce our intellectual property portfolio, and as we incur expenses associated with hiring additional personnel to support our research and development efforts.

General and Administrative Expenses

General and administrative expenses consist primarily of personnel-related costs, including employee salaries, related benefits, and stock-based compensation expense for our employees in the executive, finance and accounting, and other administrative functions. General and administrative expenses also include third-party costs such as legal costs, insurance costs, accounting, auditing and tax related fees, consulting fees and facilities and other expenses not otherwise included as research and development expenses. We expense general and administrative costs as incurred.

We expect that our general and administrative expenses will increase for the foreseeable future as we increase our headcount to support our continued research activities and development of our programs.

Other Income (Expense)

Grant Income

Grant income relates to the grants awarded from governmental bodies that are conditional cost reimbursement grants and are recognized as grant income as allowable costs are incurred and the right to payment is realized. The grants awarded relate to agreed upon direct and indirect costs for specific studies or clinical trials, which may include personnel and consulting costs, costs paid to CROs, research institutions and /or consortiums involved in the grant, as well as facilities and administrative costs. These grants are cost plus fixed fee arrangements in which we are reimbursed for eligible direct and indirect costs over time, up to the maximum amount of each specific grant award. Only costs that are allowable under the grant award, certain government regulations and the NIH's supplemental policy and procedure manual may be claimed

for reimbursement, and the reimbursements are subject to routine audits from governmental agencies from time to time. As of March 31, 2026, the Company has been awarded grants with project periods that extend through May 31, 2027, subject to extension. Our clinical trials have been funded by approximately $171.0 million in cumulative grants awarded primarily by the NIA, which includes an approximately $81.0 million grant from the NIA to fund our Phase 2 (COG0203-START) study of zervimesine in patients with early-stage AD, an approximately $30.5 million grant from the NIA to fund our Phase 2 (COG0201-SHINE) study of zervimesine in patients with mild-to-moderate AD, and an approximately $29.5 million grant from the NIA to fund our Phase 2 (COG1201-SHIMMER) study of zervimesine in patients with dementia with Lewy bodies.

Other Income, Net

Other income, net consists primarily of interest income from money market funds, offset partially by other fees such as costs incurred to establish financing opportunities.

Interest Expense

Interest expense for the three months ended March 31, 2026 and 2025 consisted of interest expense related to the insurance premium financing arrangement with a lender.

Results of Operations

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

The following table summarizes our results of operations (in thousands):

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Research and Development Expenses

The following table summarizes our research and development expenses (in thousands):

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Research and development expenses were $6.1 million for the three months ended March 31, 2026, compared to $10.8 million for the three months ended March 31, 2025. The decrease of $4.7 million was primarily due to the following:

General and Administrative Expenses

General and administrative expenses were $2.7 million for the three months ended March 31, 2026, compared to $3.0 million for the three months ended March 31, 2025. The change in general and administrative expenses was driven primarily by a decrease in stock compensation, compensation, professional fees and office expenses.

Other Income (Expense)

Grant Income

Grant income was $4.0 million for the three months ended March 31, 2026, compared to $5.1 million for the three months ended March 31, 2025. The change in grant income is correlated with the decrease in eligible reimbursable costs related to clinical trials incurred during 2026 as compared to 2025.

Other Income, Net

Other income, net was $0.3 million for the three months ended March 31, 2026, compared to other income, net of $0.2 million for the three months ended March 31, 2025. The change in other income, net was insignificant period over period.

Interest Expense

Interest expense was less than $0.1 million for the three months ended March 31, 2026, compared to interest expense of less than $0.1 million for the three months ended March 31, 2025. Interest expense was not significant in either period.

Liquidity and Capital Resources

Sources of Liquidity

To date, we have funded our operations primarily with proceeds from grants awarded by the NIA and proceeds from the sales of our convertible promissory notes, convertible preferred stock, SAFE, stock option exercises, IPO, follow-on equity offerings, and sales under our ATM programs. Since our inception, we have been awarded grant awards primarily from the NIA in the aggregate amount of approximately $171.0 million and have raised approximately $175.2 million in net proceeds from sales of our equity securities, convertible notes and SAFE, stock option exercises, our IPO and our follow-on public offerings. On December 23, 2022, we entered into a sales agreement with B. Riley, providing for the offering, issuance and sale by us of up to $40.0 million of our common stock from time to time in ATM offerings. As of December 18, 2025, immediately prior to termination of the 2022 ATM, we sold 36,396,325 shares of common stock under the 2022 ATM for gross proceeds of approximately $27.5 million. In addition, in March 2023, we entered the

Lincoln Park Purchase Agreement with Lincoln Park Capital Fund, LLC ("Lincoln Park"), giving the Company the right, but not the obligation to sell to Lincoln Park up to $35.0 million worth of shares of our common stock. The Lincoln Park Purchase Agreement's term expired on March 10, 2026.

On August 29, 2025, we completed the registered direct offering of 14,700,000 shares of our common stock at an offering price of $2.05 per share. As part of the registered direct offering, we agreed to issue warrants to the placement agent to purchase up to 514,500 shares of common stock which have an exercise price equal to $2.78. The net proceeds were approximately $27.9 million, after deducting underwriting discounts, commissions, placement agent fees, and other offering related expenses payable by us. On December 18, 2025, we entered into a Sales Agreement with Jefferies, providing for the offering, issuance and sale by us of up to $75.0 million of our common stock from time to time in ATM offerings. As of March 31, 2026, we have not sold any shares of common stock under the 2025 ATM.

As of March 31, 2026, we had $31.2 million in cash, cash equivalents, and restricted cash equivalents and have not generated positive cash flows from operations. Based on our current business plans, we believe that our existing cash and cash equivalents, income from non-dilutive grants and donations, and net proceeds from our public offerings will be sufficient for us to fund our operating expenses and capital expenditures requirements through the second quarter of 2027, which assumes no usage from the 2025 ATM. We have based these estimates on assumptions that may prove to be incorrect or require adjustment as a result of business decisions, and we could utilize our available capital resources sooner than we currently expect.

Future Funding Requirements

We expect to continue to incur significant and increasing expenses and net losses for the foreseeable future, as we advance our current and future product candidates through preclinical and clinical development, manufacture drug product and drug supply, seek regulatory approval for our current and future product candidates, maintain and expand our intellectual property portfolio, hire additional research and development and business personnel, and operate as a public company. We anticipate that we will need to raise additional funding in the future to fund our operations, including the commercialization of any approved product candidates. We are subject to the risks typically related to the development of new products, and we may encounter unforeseen expenses, difficulties, complications, delays, and other unknown factors that may adversely affect our business.

Our future funding requirements will depend on many factors, including, but not limited to:

Until such time as we can generate significant revenue from product sales, we expect to finance our operations through a combination of public or private equity offerings, debt financings or other sources, such as potential collaboration agreements and strategic alliances, licensing or similar arrangements with third parties. To the extent available, we expect to continue our pursuit of non-dilutive research contributions, or grants, including additional NIA grant funding. However, we may fail to receive additional NIA grants, or we may be unable to raise additional funds or enter into such other agreements or arrangements when needed on acceptable terms, or at all. Our failure to obtain additional NIA grants or raise capital or enter into such agreements as and when needed could have a material adverse effect on our business, results of operations and financial condition.

To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders will be or could be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise funds through collaborations, licenses and other similar arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to us and/or may reduce the value of our common stock. Adequate funding may not be available when needed or on terms acceptable to us, or at all. Our ability to raise additional funds may be adversely impacted by potential worsening global economic conditions and the recent disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from the ongoing global and regional conflicts, inflation, tariffs, liquidity constraints, failures and instability in U.S. and international financial banking systems, and otherwise. If we fail to obtain necessary capital when needed on acceptable terms, or at all, it could force us to delay, limit, reduce or terminate our product development programs, commercialization efforts or other operations. Insufficient liquidity may also require us to relinquish rights to product candidates at an earlier stage of development or on less favorable terms than we would otherwise choose. We cannot assure you that we will ever be profitable or generate positive cash flows from operating activities.

Cash Flows

The following table summarizes our cash flows for the periods indicated (in thousands):

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Cash used in operating activities

Net cash used in operating activities for the three months ended March 31, 2026 and 2025 was $5.5 million and $9.9 million, respectively. The change in cash used in operating activities of $4.4 million was driven by a decrease in net loss.

Cash used in investing activities

During the three months ended March 31, 2026 and 2025, no cash was used in or provided by investing activities.

Cash provided (used) by financing activities

Net cash provided (used) by financing activities was $0.2 million and $1.3 million for the three months ended March 31, 2026 and 2025, respectively. The change in net cash by financing activities is primarily related to no ATM activity during 2026 compared to net proceeds from the issuance of common stock under the ATM program in 2025.

Contractual Obligations

The following table summarizes our contractual obligations as of March 31, 2026 (in thousands):

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In October 2024, we entered into an insurance premium financing arrangement whereby we financed $0.4 million of certain premiums at a 8.65% annual interest rate. Payments of less than $0.1 million are due monthly from November 2024 through July 2025. As of March 31, 2026, there was no outstanding balance on the loan.

In October 2025, we entered into an insurance premium financing arrangement whereby we financed $0.4 million of certain premiums at a 7.95% annual interest rate. Payments of less than $0.1 million are due monthly from November 2025 through August 2026. As of March 31, 2026, the outstanding principal amount of the loan was $0.2 million.

We have entered into operating leases for office and laboratory facilities under agreements that run through May 31, 2029. The amounts reflected in the table above consist of the future minimum lease payments under the non-cancelable lease arrangements.

On August 31, 2022, we entered into an agreement to lease 2,980 square feet of office space in Pittsburgh, Pennsylvania. The lease has a term of 45 months and commenced on October 1, 2022. The annual base rent under the lease is less than $0.1 million throughout the term of the lease. Total payments due over the term of the lease are $0.2 million. Additionally, on August 31, 2022, we modified one of our existing lease agreements with the landlord for approximately 3,706 square feet of lab space at the same location to extend the lease term termination date from June 30, 2023 until June 30, 2026. On January 27, 2026, we modified our existing lease agreement with the landlord to reduce our lab space from 3,706 square feet to 1,577 square feet with no change to the lease term.

On July 1, 2021, we entered into an agreement to lease 2,864 square feet of office space in Purchase, New York. The lease has a term of 89 months and commenced on December 9, 2021. The annual base rent under the lease is less than $0.1 million for the first lease year and is subject to annual increases of between 1.82% and 2.04%. We provided a security deposit in the form of a Letter of Credit in the amount of less than $0.1 million pursuant to the terms of the lease.

We enter into contracts in the normal course of business with CROs and other vendors to assist in the performance of our research and development and other services and products for operating purposes. These contracts typically do not contain minimum purchase commitments and generally provide for termination on notice, and therefore are cancelable contracts and not included in the table of contractual obligations.

Critical Accounting Policies and Use of Estimates

The Critical Accounting Policies and Significant Judgements and Estimates included in our Annual Report on Form 10-K have not materially changed. See "Critical Accounting Policies and Use of Estimates" included in Part II, Item 7 of our Annual Report on Form 10-K filed with the SEC on March 26, 2026.

Recent Accounting Pronouncements

For a description of recent accounting pronouncements, see Note 2 of the notes to our consolidated financial statements included in this Quarterly Report.

Emerging Growth Company Status

We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. We elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that we (1) are no longer an emerging growth company or (2) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.

We will remain an emerging growth company until the earliest to occur of: (1) the last day of the fiscal year in which we have at least $1.235 billion in annual revenue; (2) the last day of the fiscal year in which we are deemed to be a "large accelerated filer," as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common stock held by non-affiliates exceeded $700.0 million as of the last business day of the second fiscal quarter of such year; (3) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period; and (4) the last day of the fiscal year ending after the fifth anniversary of our IPO.