CervoMed Announces Q1 2024 Financial Results and Corporate Updates

CervoMed Inc. is advancing its RewinD-LB Phase 2b clinical trial to evaluate the efficacy of neflamapimod in treating patients with dementia with Lewy bodies (DLB). The company anticipates completing patient enrollment by the second quarter of 2024, with topline results expected in the fourth quarter of the same year.

CervoMed, a clinical-stage company listed on NASDAQ under the ticker CRVO, focuses on developing treatments for age-related neurological disorders. In the first quarter of 2024, the company reported significant progress and achievements. The financial results for this period highlight a period of robust operational and clinical activities.

According to John Alam, MD, CEO of CervoMed, the company has made considerable strides in strengthening its financial resources and publishing data that underscores the unique potential of neflamapimod as a groundbreaking treatment for DLB. Neflamapimod has shown promise in preclinical and clinical studies by potentially reversing cholinergic dysfunction and degeneration in the basal forebrain, which could improve cognitive and motor functions in patients. The ongoing RewinD-LB Phase 2b trial builds on these encouraging results, targeting DLB patients who are most likely to benefit from the drug. CervoMed aims to complete enrollment by the second quarter of 2024, with topline efficacy data anticipated by the end of the year.

In addition to its core focus on DLB, CervoMed plans to explore other neurological disorders driven by cholinergic dysfunction, seeking to broaden the therapeutic applications of neflamapimod.

The company has successfully raised up to $149.4 million through a private placement with leading healthcare investors, completed on April 1, 2024. The initial gross proceeds amounted to $50.0 million, with the potential for an additional $99.4 million if warrants issued during the placement are fully exercised. Combined with existing funds and grants, this financial boost is expected to support CervoMed's operations through the end of 2025.

For the first quarter of 2024, CervoMed reported a cash position of approximately $6.4 million, down from $7.8 million at the end of 2023. This does not include the proceeds from the recent private placement. The company also received around $2.3 million in grant revenue for the quarter, up from $1.4 million in the same period the previous year, thanks to a $21.0 million grant from the National Institute on Aging (NIA).

Research and Development (R&D) expenses rose to approximately $2.8 million in the first quarter of 2024, compared to $1.8 million in the same quarter of 2023. This increase was primarily due to higher costs associated with contract research organizations and site expenses for the RewinD-LB trial. General and Administrative (G&A) expenses also climbed to around $2.1 million from $1.0 million in the first quarter of the previous year, driven by increased accounting fees, insurance costs, headcount expenses, stock-based compensation, and public relations costs following CervoMed's reverse merger and its commencement of trading as a public company in August 2023.

The company's operating loss for the first quarter of 2024 was approximately $2.6 million, compared to $1.4 million for the same period in 2023. However, net income was around $2.5 million, a considerable improvement from the net loss of approximately $0.5 million reported in the first quarter of 2023.

The ongoing Phase 2b RewinD-LB study is a 16-week, double-blind, placebo-controlled trial involving up to 160 patients with very mild or mild DLB. After the initial study period, patients can continue on open label neflamapimod for an additional 32 weeks. The trial's primary endpoint is the change in Clinical Dementia Rating Sum of Boxes, with secondary endpoints including the Timed Up and Go test, cognitive test battery, and Clinician’s Global Impression of Change. Funded by a $21.0 million grant from the NIA, the study is being conducted at 43 sites across the United States, the United Kingdom, and the Netherlands. More details can be found on clinicaltrials.gov.

CervoMed remains committed to developing neflamapimod, an investigational small molecule that inhibits p38MAP kinase alpha, aiming to treat synaptic dysfunction and the underlying neurodegenerative processes in DLB and other neurological disorders.