Prepared remarks
Good day, and thank you for standing by. Welcome to the Addex Therapeutics first quarter 2026 Financial Results and Corporate Update Conference Call and Webcast. At this time, all participants are in listen-only mode. After the speakers' presentation, there will be the question-and-answer session. To ask a question during the session, you need to press star 1 then 1 on your telephone keypad. You will not hear an automatic message advising your hand is raised. To withdraw a question, please press star 1 and 1 again. If you wish to ask a question via the webcast, please use the Q&A box available on the webcast link at any time during the live event. Please be advised that today's conference is being recorded. I would now like to hand the conference over to our first speaker today, Timothy Mark Dyer, Chief Executive Officer. Please go ahead.
Hello, everyone. I would like to thank you all for attending our Q1 2026 financial results conference call. I am here with Mikhail Kalinichev, our Head of Translational Science, who will provide an update on our R&D program. I draw your attention to the press release and the financial statements issued earlier today, which are available on our website. I also draw your attention to our disclaimer. We will be making certain forward-looking statements that are based on the knowledge we have today. I will start this conference call by giving a quick overview of our activities and achievements before reviewing our pipeline. I will then hand over to Misha who will review in more detail our mGluR5 negative allosteric modulator program for brain injury recovery and the GABAB positive allosteric modulator program for cough. I will then review our 2026 Q1 financial results. Following that, we will open the call for Q&A. So starting with the highlights, Q1 has seen several important achievements across our pipeline. We have made excellent progress in our GABAB PAM cough program as we continue to complete preclinical characterization of our selected compound. We recently announced robust antitussive activity in a nonhuman primate cough model as well as solid antitussive activity in an idiopathic pulmonary fibrosis model in guinea pigs. These data further demonstrate the potential of our selected compound in this important unmet medical need. In parallel to completing the preclinical profiling, we are working to secure funding to advance the program into IND-enabling studies. Mikhail will be sharing some of the data with you later in our presentation. We have repositioned Dipraglurant, our mGluR5 negative allosteric modulator, for brain injury recovery and have made good progress in preparing the program for clinical studies in post-stroke recovery patients. In 2025, we entered into an option agreement giving us an exclusive license to intellectual property covering the use of mGluR5 in brain injury recovery, including stroke and traumatic brain injury. Included in the agreement is a research collaboration under which we are working with Sinntaxis and Lund University in Sweden to complete preclinical profiling of Dipraglurant and prepare for clinical studies. Again, Mikhail will talk more about this exciting program later in the presentation. As a reminder, we spun out our portfolio of preclinical neuropsychiatric assets in 2024 to create Neurosterix and raise CHF 5 million through a syndicate investment led by Percepta. We retained a 20% equity interest in Neurosterix, the value of which is unfortunately not being properly reflected in our current share price. Neurosterix has made excellent progress in advancing its pipeline, including its M4 PAM and mGluR7 NAM programs. The lead drug candidate in the M4 PAM program, NTX-53, is in Phase 1, and we expect data in Q3 this year. On the financial side, we completed the quarter with CHF 900 thousand of cash and successfully raised CHF 300 thousand in Q2. Given that our cash burn is extremely low following the spinout, this provides us with cash runway through into Q4 of 2026 on a going concern basis. However, current cash does not fund the progression of our unpartnered programs into the clinic. Now for a quick review of our pipeline. As mentioned, we continue to believe in Dipraglurant and we are executing our plans to reposition development for brain injury recovery. As a reminder, we have regained the rights to ADX-9 from our partner J&J with a high-value data set and significant GMP materials. We are currently evaluating a number of therapeutic indications for future development and, in parallel, are discussing potential partnerships for the asset. For our GABAB PAM collaboration with Indivior, Indivior has selected a compound for development in substance use disorders and has successfully completed IND-enabling studies. As a reminder, under the terms of the agreement, Addex is eligible for payment of up to $313 million on successful achievement of pre-specified regulatory, clinical, and commercial milestones, as well as tiered royalties on the level of net sales from high single digits up to low double digits. As mentioned earlier, we are advancing an independent GABAB program for cough and expect to start IND-enabling studies this year subject to securing financing. Also presented on this slide is the portfolio of our spinout company, Neurosterix. We are expecting Phase 1 data from the NTX-53 program in Q3. Backup M4 PAM compound NTX-9 has been selected for IND-enabling studies, which should start shortly. The mGluR7 NAM program has selected NTX-81, a highly selective first-in-class compound, which has demonstrated robust preclinical antidepressant-like activity that supports its development as a potential next-generation therapy. We expect NTX-81 to complete IND-enabling studies in the coming months. Now I will hand over to Misha, who will give you some more details about our exciting portfolio.
Thanks, Timothy. Hello, everyone. I will start by speaking about Dipraglurant and our plans for development in brain injury recovery. The program is an orally available, highly selective mGluR5 negative allosteric modulator which we believe could improve the outcome of rehabilitation for patients suffering from traumatic brain injury or stroke. The mechanism of action of Dipraglurant targets neuroplasticity early in rehabilitation to promote the building of neuronal connections and sensorimotor recovery. The unmet medical need and commercial opportunity in post-stroke and TBI recovery is undisputed. Stroke is among the leading causes of chronic, often lifelong disability as it leads to motor, sensory, cognitive impairment and multiple comorbidities. There are over 100 million stroke survivors worldwide, and the number is growing at an annual rate of 12 million. A variety of rehabilitation therapies are used with post-stroke patients, but recovery is slow and often inadequate. There is an urgent need for pharmacological agents that can facilitate recovery stimulated by rehabilitation therapy. Now to why mGluR5 NAM is such a great target for this indication. The mGluR5 receptor is a suitable target to address post-stroke recovery as it is densely expressed in brain regions involved in neuroplasticity and modulates excitatory–inhibitory balance. Activation of mGluR5 has been observed in a large range of neurological disorders including stroke, where it plays a role in so-called maladaptive rewiring of the brain following stroke. Inhibition of mGluR5, on the other hand, can facilitate adaptive rewiring of the brain, promoting neuroplasticity and creation of new functional networks toward the pre-lesion state. Now to the data. I would like to refer you to the left-hand figure which shows exciting new evidence recently published in the journal Brain. These data show that the negative allosteric modulator of mGluR5, MPEP, administered daily in rats following stroke results in a sustained and growing improvement in sensorimotor function in comparison to vehicle treatment. In the right-hand figure, we can see a similar improvement in sensorimotor function that was observed in animals treated with our mGluR5 NAM. We are currently working with our collaboration partner, Sinntaxis, to complete the preclinical profile of Dipraglurant in this animal model. In addition to the compelling in vivo data, MRI imaging of resting state functional connectivity in post-stroke models shows that daily administration of MTEP also stimulates intra- and interhemispheric connectivity in the brain disrupted by stroke. It is important to note that improvement in brain connectivity after stroke is known to correlate with functional recovery and is observed across species. Dipraglurant is ideally suited to be used in conjunction with rehabilitation therapies in post-stroke patients as it has a fast onset of action and short half-life. It has shown good tolerability in healthy subjects and in Parkinsonian patients, showing only mild to moderate CNS-related adverse effects. We have a drug product ready and a strong patent position and believe Dipraglurant can become a first-in-class drug to facilitate post-stroke recovery. We can also speculate that the mediated adaptive rewiring and facilitation of recovery following brain damage would also be seen in traumatic brain injury patients. The next step in clinical development is to perform an imaging study in stroke patients to show the intra- and interhemispheric connectivity in the brain disrupted by stroke. Now, I would like to update you on our GABAB positive allosteric modulator cough program. As a part of our agreement with Indivior, Indivior has exercised its right to select a compound to advance, and ADX has exercised its right to select a compound to advance its own independent GABAB PAM program for the treatment of chronic cough. I will now present this exciting opportunity. There is a strong rationale for developing GABAB PAMs for chronic cough. Chronic cough is a persistent cough that lasts more than 8 weeks and can be caused by a variety of factors, including respiratory infections, asthma, allergies, and acid reflux, but also possibly by a cough hypersensitivity syndrome. There is a large unmet medical need in novel antitussive drugs as current standards of care are ineffective in 30 percent of patients or only moderately effective in up to 60 percent of patients. In addition, current treatments carry risks of serious side effects. Support for using GABAB PAMs in the treatment of chronic cough comes from clinical evidence that baclofen, a GABAB agonist, is used off-label in cough patients and from anatomical evidence that GABAB receptors are strongly expressed in airways and in the neuronal pathway regulating cough. Therefore, we believe that GABAB PAMs could offer superior efficacy in cough patients. The pre-IND activities— in vivo proof of concept, non-GLP toxicology, and CMC—have been completed, and our clinical candidate has shown favorable efficacy, tolerability, and developability profiles. Our clinical candidate has demonstrated a consistent minimal effective dose at 1 mg/kg and an ED50 of 6 mg/kg in cough frequency in a guinea pig model of cough. No signs of tolerance were seen after subchronic dosing and more than a 60-fold safety margin was demonstrated based on respiratory depression and sedation biomarkers. Recently, we confirmed the antitussive efficacy in nonhuman primates and are now currently evaluating the compound in rabbits. IND-enabling studies are planned and ready to start subject to securing financing. Now to the data. In the model of citric acid-induced cough in guinea pigs, acutely administered Compound A delivered robust antitussive efficacy, reducing cough number dose-dependently and achieving 70% reductions at the maximum dose. The antitussive profile of Compound A was similar to that of nalbuphine, orvepitant, repitant, baclofen, and codeine. Now to cough latency. Compound A increased latency to first cough dose-dependently, thus delaying the onset of cough. The antitussive profile of Compound A in delaying cough onset was similar to or better than that of reference drugs. As a reminder, our objective in the program is to design a GABAB PAM with the efficacy of the references but without the CNS side effects such as sedation. In the same experiment where Compound A showed efficacy, we monitored respiratory rate as a biomarker of sedation. Compound A was well tolerated as there were no marked changes in respiratory rate at up to 60 mg/kg. In contrast, nalbuphine, orvepitant, repitant, baclofen, and codeine resulted in robust reductions of respiratory rate at doses required to achieve maximal efficacy, indicative of sedative-like effects. When we evaluated the antitussive efficacy across compounds at the respective highest doses free from respiratory effects, Compound A was shown to be superior to nalbuphine, orvepitant, repitant, baclofen, and codeine in both cough number and cough latency measures. In the model of ATP-potentiated citric acid in guinea pigs in a head-to-head comparison experiment, acutely administered Compound A and the P2X3 inhibitor had similar efficacy and tolerability profiles. As a reminder, P2X3 inhibitors' antitussive activities are peripherally mediated, which explains their lack of sedative effects, but also the reason why more than 30 percent of patients do not respond to treatment. In the citric acid-induced cough model, subchronic administration of Compound A for 7 days showed no signs of tolerance, neither in cough frequency nor in latency to first cough. Also, there were no changes in respiratory rate, temperature, or gross hormone release in animals treated subchronically with Compound A. Compound A was also assessed in the IPF-related exacerbated chronic cough model in guinea pigs. Here is the study design: On day 0, animals received a single oropharyngeal administration of bleomycin or were left intact. Bleomycin-exposed animals were then treated with Compound A or vehicle orally once daily for 28 days. Intact animals received vehicle. On day 14, 21, and 28, animals were exposed to low concentrations of citric acid to stimulate cough. On day 28, at the end of the experiment, the lung tissue was collected for histopathological analysis. The total number of coughs was significantly higher in bleomycin-exposed vehicle-treated animals than in healthy controls. This difference between the groups grew progressively larger over time, indicative of exacerbated cough in an IPF-like condition. Chronic treatment with Compound A resulted in robust and enduring reductions in the number of coughs with 40–60% reduction magnitude. The latency to first cough showed significant reductions in bleomycin-exposed vehicle-treated animals versus intact control starting day 14. Chronic treatment with Compound A reversed the effect of bleomycin throughout the testing period, returning the latencies to the levels of intact control animals. Histological analysis of lung tissue collected on day 28 revealed that chronic administration of Compound A was associated with markedly lower Ashcroft scores and a lower percentage of affected lung in comparison to bleomycin-exposed vehicle animals. This suggests that Compound A administered over 28 days reduced lung fibrosis. Now to the nonhuman primate cough data. Similar to what we saw in guinea pigs, in the model of citric acid-induced cough in nonhuman primates, Compound A demonstrated more than 60% reductions in number of coughs at 2 mg/kg. In summary, we have selected a clinical candidate for chronic cough with robust, reproducible antitussive efficacy at 1 mg/kg and good PK/PD. The compound showed a favorable developability profile in non-GLP toxicology studies performed in rats, dogs, and nonhuman primates. The compound has potential to have the best-in-class efficacy and tolerability profile and broad application in chronic cough patients. Subject to raising financing, we are ready to start IND-enabling studies. This concludes our prepared remarks on the progress of our R&D programs. Now I hand it back to Timothy.
Thanks, Misha. Now for a view of our Q1 2026 financials. Starting with the income statement, the operating loss amounted to CHF 500 thousand in Q1 2026 compared to CHF 600 thousand in Q1 2025. The decrease of CHF 100 thousand between both periods is primarily due to reduced outsourced R&D. As a reminder, on 04/02/2024, we received an equity interest of 20% in Neurosterix as part of our transaction. Under IFRS, we are required to account for the investment using the equity method of accounting and recognize our share of their results in our income statement. For the three-month period ended March 31, 2026, our share of the net loss of Neurosterix amounted to CHF 1.3 million compared to CHF 800 thousand for the three-month period ended March 31, 2025. This increase is primarily driven by the move of NTX-53 into clinical development by Neurosterix. The net loss amounted to CHF 1.7 million during the first quarter compared to CHF 1.5 million during the same period ended March 31, 2025, again strongly driven by the increase in our share of the Neurosterix results. Now to the balance sheet. We completed Q1 with CHF 900 thousand of cash held in Swiss francs and, to a lesser extent, US dollars, compared to CHF 1.6 million held at the end of 2025. The decrease of CHF 800 thousand is primarily due to our operating loss of CHF 500 thousand and an increase in net working capital of CHF 300 thousand driven by one-off annual payments made at the beginning of the year, such as retirement benefit contributions and insurance premiums. Our current assets amounted to CHF 25 thousand, primarily related to increased prepaid retirement benefit contributions. Our noncurrent assets of CHF 3.5 million at the end of March primarily relate to our investment in Neurosterix, accounted for using the equity method, and to a lesser extent our investments in SOLICLA. Current liabilities remain steady at CHF 1.2 million at the end of March compared to December and primarily relate to accruals and payables from outsourced R&D and professional service activities. Noncurrent liabilities primarily relate to retirement benefit obligations calculated in accordance with IAS 19 and amounted to CHF 300 thousand at the end of Q1 compared to CHF 400 thousand at the end of December. Now to the cash flow statement. We started the quarter with CHF 1.6 million. We used CHF 766 thousand for operations, primarily R&D and G&A activities. We received CHF 65 thousand from the sale of treasury shares and completed the quarter with CHF 935 thousand. As mentioned in the highlights, we have been active with our ATM facilities, both on NASDAQ and the SIX exchange, and raised a very small amount of capital in Q2 to strengthen the balance sheet. To summarize, we have made excellent progress in advancing our GABAB PAM program for cough and our Dipraglurant post-stroke recovery program. Our spinout company, Neurosterix, continues to advance its portfolio with their M4 PAM program on track to complete Phase 1 in Q3. We are very pleased by the progress Neurosterix is making in advancing its business strategy and pipeline. We are looking forward to completing our evaluation of potential indications for our mGlu2 PAM program and securing the financial resources to advance our portfolio into clinical studies. This concludes the presentation, and we will now open the call for questions.
Questions and answers
Thank you so much, dear participants. Press star 1 on the telephone keypad and wait for your name to be announced. To withdraw a question, please press star 1 again. Alternatively, you can submit your questions via the webcast. Please stand by. Our conference operator will take a few moments to compile the Q&A roster. Once again, if you would like to ask a question, please press star 1. And now we are going to take our first question. It comes from the line of Raghuram Selvaraju from H.C. Wainwright & Co. Your line is open. Please ask a question.
Thanks so much for taking our questions. We have four of them. Two of these relate to the chronic cough program. Firstly, I was wondering if you could provide us with some assessment of the relative position of your lead candidate, the GABAB PAM, against nalbuphine extended-release? Also, I was wondering if you are thinking about potential dosing formulations that may reduce dosing frequency and therefore improve patient convenience as you look towards advancing this into the clinic. The second question on that front is related specifically to the guinea pig model. I was just wondering how you typically measure cough intensity in that context and to what extent you rely on those measurements relative to the assessment of the lung tissue. Thank you.
Yes, happy to answer the question. Let me start with the first, which is comparison of nalbuphine with our candidate Compound A. As you saw on the slide I shared, the overall profile is very similar. Compound A appears to be more potent. We see a minimal effective dose at 1 mg/kg, whereas with nalbuphine you need to administer 3 mg/kg in exactly the same model in guinea pigs where cough is stimulated by citric acid inhalation. In terms of maximal efficacy, both deliver approximately a 70% reduction. The difference comes from the tolerability aspect of nalbuphine versus a GABAB PAM. At the top dose of nalbuphine, 30 mg/kg, we see significant reductions in respiratory rate, and this is aligned with what we know about the tolerability profile of nalbuphine in clinical trials where it showed CNS-related side effects even at doses lower than those corresponding to what we tested in animals. If we use a 75-kg calculation for a human body weight, the efficacy dose in animals roughly aligns to 3–5 mg/kg. Based on that, we expect similar efficacy to nalbuphine but a markedly wider therapeutic margin for our GABAB PAM. Regarding your second question on formulation, our current formulation is expected to deliver once-daily dosing. So there will be no need for extended-release unless we aim for something like once-weekly or once-monthly. A once-daily formulation is believed to be achievable with the current simple formulation that we have. This contrasts with nalbuphine where even extended-release formulations require twice-daily administration, which is another advantage for our candidate. On intensity: we use plethysmography chambers that deliver cough frequency and cough latency measures. There is no way of measuring cough intensity with that setup. Cough intensity is even challenging to measure in human patients, but there are some technical advances that may deliver intensity measures; it is still in development.
And then with respect to the Neurosterix equity holding, I was wondering, Timothy, if you can comment on what strategically your outlook is for long-term management of this equity position and if you have any thoughts around how Addex might ultimately assess the disposition or potential monetization of it. How are you thinking about this specifically in the context of a possible future public listing? I was also wondering if, from a scientific perspective, you could comment on the complex interplay between muscarinic receptor signaling pathways, and in particular, could you talk a little bit about M1 and M4 receptor modulation relative to M4 and mGluR7 modulation, and how these aspects might potentially have differing therapeutic applicability within the context of schizophrenia versus depression? Thank you.
Okay, let me take the first one about the equity holding. Thank you very much for the questions. We founded Neurosterix really as a financing vehicle for some of our preclinical programs. If you remember and dig into the press releases back in 2024, Neurosterix raised CHF 6.5 million, and Addex received a 20% equity holding. If you run the numbers, the 20% equity interest that Addex received was valued based on the post-money valuation of Neurosterix at about CHF 20 million. Now, clearly, with a market cap of CHF 8 million today, there seems to be a disconnect. What we know about Neurosterix is that it has advanced in the last two years: an M4 PAM from clinical candidate selection substantially through Phase 1, and we expect Phase 1 to complete very soon with data coming out in Q3. It has also identified a backup compound in the M4 PAM program called NTX-9, which is ready to go into IND-enabling studies. It has advanced the mGluR7 program which is a first-in-class compound with a battery of preclinical data showing potential in neuropsychiatry, in particular anxiolytic and antidepressant effects. So we believe that the equity holding is not being correctly reflected in the market value today. The question for us is whether to monetize it now or to retain it to capture future upside. We have had some inbound interest. One strategy could be to monetize the Neurosterix interest and use proceeds to invest in our cough program. Alternatively, Neurosterix at some point may execute a Series B, whether privately or via a public offering. I am not in a position on this call to provide detail on Neurosterix's financing plans, but we are evaluating all opportunities to build value for our shareholders with that equity position. Now I would like to hand over to Misha who is very knowledgeable about the muscarinic space and can address the receptor biology question in more detail. Thank you.
So we believe that the contribution of M1 to the antipsychotic efficacy of the combination zanomeline plus trospium is speculative. This is still being discussed; there is no robust data that support that the M1 component is necessary or contributes significantly to efficacy in cognition or in psychosis reduction. As you know, multiple companies have developed M1-selective muscarinic compounds for cognitive improvement and those clinical trials showed lack of activity. Some also showed a range of peripheral muscarinic side effects, which is another consideration. If we look at animal studies that evaluated the antipsychotic-like profile of zanomeline in rodents, it was very clear that the main bulk of activity in a hyperactivity model is driven by muscarinic M4 receptor with virtually no contribution from M1. Then, of course, we have positive Phase 1b clinical trial data with emraclidine. Putting it all together, we believe that having a selective M4 positive allosteric modulator will be able to deliver clinical efficacy in schizophrenia similar to what is seen with zanomeline. Regarding mGluR7: I believe you meant mGluR7. The interplay between that and the muscarinic M4 system is not characterized by direct evidence of interaction. There is some evidence of interaction between mGluR7 and mGluR8—these may form heterodimers and co-administration can impact outcomes—but I am not aware of any functional interaction between muscarinic M4 and mGluR7. Thank you.
Thank you so much. Please press star 1 on your telephone keypad and wait for your name to be announced. Alternatively, you can submit your questions via the webcast. The speakers will just give a moment for participants to enter the queue. There are no further questions at this time. Thank you, ladies and gentlemen. This brings the main part of our conference to a close, and I would like to hand back to Timothy Mark Dyer for closing remarks.
Thank you. And thank you, everyone, for attending this call. We look forward to speaking to you again soon, and we wish you a very nice end to your day and end to your week. Thank you. Bye.
This concludes today's conference call. Thank you for participating. You may now disconnect. Have a nice day.