Alpha Cognition Inc. (NASDAQ: ACOG) Q2 2025 Earnings Call | 08/15/2025

Alpha Cognition Inc. reported its Q2 2025 financial results, marking its first earnings call following the commercial launch of Zunval, a treatment for mild to moderate Alzheimer’s disease. The call highlighted commercial progress, financial performance, research and development updates, and business development milestones.

Key Highlights

1. Commercial Launch of Zunval
   • Market Penetration: The sales team engaged over 3,700 healthcare providers (HCPs) in the long-term care (LTC) market, with prescriptions written in over 300 nursing homes. 65% of these facilities had repeat prescriptions, indicating strong product trial.
   • Prescriber Engagement: 1,564 unique prescribers were reached, with 370 writing at least one Zunval prescription, and 56% writing multiple prescriptions.
   • Payer Progress: A contract was signed with a major national health plan, providing access to ~17 million Medicare Part D lives. Additional payer discussions are ongoing, with expectations of at least one more large contract by year-end.
   • Challenges: Increased demand led to more prior authorizations, delaying fulfillment (up to three weeks), though 90% of orders were filled.
   • Behavioral Messaging: New messaging emphasizing Zunval’s benefits on behavioral symptoms (aligned with the Neuropsychiatric Inventory) has broadened its appeal, targeting patients with or without prior cholinesterase inhibitor use.
2. Financial Performance
   • Revenue: $1.7 million in total revenue, including $1.6 million from Zunval sales and $81,000 from licensing with CMS Pharmaceuticals. Total Zunval net revenue since launch: ~$2 million.
   • Expenses: Operating expenses were $6.9 million (up from $2.4 million in Q2 2024), driven by Zunval’s commercial launch. Total costs and expenses: $7.4 million.
   • Net Loss: $10.5 million ($0.65/share), compared to $2.1 million ($0.35/share) in Q2 2024, primarily due to a $5.2 million non-cash loss from warrant liabilities.
   • Cash Position: $39.4 million in unrestricted cash and cash equivalents as of June 30, 2025, plus $425,000 in interest income.
   • Guidance: Full-year 2025 operating expenses projected at $34–38 million, reflecting cost optimization and efficient resource allocation.
3. Research and Development
   • Sublingual Formulation: Development for Alzheimer’s patients with dysphagia/aphasia (20% of patients) is on track, with formulation and tasting work expected to conclude in Q1 2026. A comparative PK study and IND submission are planned for H1 2026.
   • TBI Study: A preclinical study with Alpha-1062 (funded by a Department of Defense grant) showed reduced neuroinflammation, neuropathology, and toxic Tau protein levels in a bomb blast model, suggesting potential for traumatic brain injury (TBI) treatment.
4. Business Development
   • Partnered with CMS Pharmaceuticals for Zunval in China and Greater Asia. Chinese regulatory authorities accepted Zunval’s application for review, with filings planned in four additional countries by year-end. Ex-US revenues are expected in late 2026.
5. Outlook
   • Commercial Focus: Expand Zunval’s presence in LTC homes, increase repeat prescribers, deepen HCP engagement, and advance payer access for 2026.
   • Financial Discipline: Maintain cost efficiency while scaling commercial efforts.
   • Revenue Expectations: Monthly net revenue run rate for Q3 2025 projected at $575,000–$625,000. A $3 million tranche from CMS is expected in Q4 2025.
   • Long-Term Growth: Anticipates a “hockey stick” revenue curve, with significant ex-US revenue contributions in late 2026/early 2027.

Q&A Highlights

• Repeat Prescribers (Ram Salvaraju): No specific profile for repeat prescribers, as the focus is on high-volume LTC facilities with Alzheimer’s patients. Consistent messaging and frequent visits drive repeat prescriptions.
• Prior Authorizations (Ram Salvaraju): Increased demand led to more prior authorizations, requiring evidence of prior generic use or intolerance. Approval rates remain high (90%), but delays persist.
• Capital Allocation (Ram Salvaraju): R&D costs for sublingual formulation and TBI programs are included in the $34–38 million expense guidance, with low-cost formulation work ongoing.
• Patient Types (Boris Peeker): Zunval is used for patients switching from donepezil, those previously intolerant to treatments, and increasingly for behavioral symptom management.
• Net Discount (Boris Peeker): Current net discount is ~$600, expected to stabilize at $575–$625 over the next few quarters.
• Revenue Curve (Dave Storms): No change to the expected “hockey stick” revenue trajectory, with steady growth in LTC and significant ex-US contributions in 2026–2027.
• Operating Expenses (Dave Storms): Expected to stabilize at $34–38 million over the next 3–4 quarters.