Additional funding will extend anticipated runway into second quarter of 2027
Strategic priority is to establish a partnership to advance neflamapimod into Phase 3 in dementia with Lewy bodies
Anticipated pipeline milestones over next six months include obtaining 24-week biomarker and clinical data from Phase 2a trial evaluating neflamapimod in nonfluent variant primary progressive aphasia and initiation of EXPERTS-ALS Phase 2a trial
Financing includes substantial participation from insiders and leading institutional healthcare investors
BOSTON, June 10, 2026 (GLOBE NEWSWIRE) -- CervoMed Inc. $(CRVO)$, a clinical-stage biotechnology company developing treatments for age-related brain disorders (CervoMed or the Company), today announced that it has entered into a definitive securities purchase agreement for a private placement, from which the Company anticipates upfront gross proceeds of approximately $10.5 million, before deducting offering-related fees and expenses.
The private placement financing was led by leading institutional healthcare investors, and was supported by insiders, including Joshua S. Boger, PhD, founder of Vertex Pharmaceuticals and chair of CervoMed's board of directors, and trusts related to John J. Alam, MD, CervoMed's president and chief executive officer, and Sylvie Grégoire, PharmD, a member of CervoMed's board of directors. The net proceeds from the financing will extend the Company's anticipated cash runway into the second quarter of 2027 and will support the pursuit of a strategic partnership to advance neflamapimod into Phase 3 development for the treatment of dementia with Lewy bodies $(DLB)$.
Dr. John Alam stated: "We are extremely pleased with the momentum we have achieved in progressing neflamapimod in DLB over the past 6 months, which includes the presentation of the full clinical data from the Phase 2b RewinD-LB trial at major scientific conferences and alignment with the FDA and global regulators on a potential registration path in DLB. We believe this substantial progress, our differentiated scientific approach, and the commercial opportunity presented by the unmet medical need in DLB create a compelling opportunity for a strategic partner, and that such a partnership could provide the opportunity to generate significant value for our stockholders. In parallel with our increased focus on strategic partnering, the financing announced today provides the necessary capital to advance neflamapimod through key near-term clinical milestones in our other pipeline indications, including nonfluent variant PPA and ALS programs."
Dr. Joshua S. Boger added: "DLB is the second most common type of progressive dementia after Alzheimer's disease $(AD)$ and represents a significantly underserved population where there is a substantial unfulfilled need for effective new treatments that have the ability to target the underlying cause of the disease. Neflamapimod has shown compelling Phase 2a and 2b clinical data from both an efficacy and safety perspective to date, and we believe it has significant potential to improve outcomes for patients. We are honored to have such strong support from the scientific, medical, and financial communities as we work to bring neflamapimod to those with and affected by DLB, and the physicians treating them."
Today, the Company also provided an update on its strategic plan and priorities to advance neflamapimod in DLB and multiple rare neurological disorders.
Strategic Pipeline Priorities
Establish strategic partnership to advance Phase 3-ready neflamapimod program in DLB
-- Alignment with US Food and Drug Administration (FDA) on potential
registration path for neflamapimod in DLB announced in November 2025,
supported by data from two Phase 2 trials. Alignment with the Medicines
Healthcare products Regulatory Agency in the United Kingdom (UK) and the
European Medicines Agency on potential registration path for neflamapimod
in DLB obtained in January 2026.
-- Focus on DLB patients without AD co-pathology represents a differentiated,
scientifically validated approach in a multi-billion dollar market with
no approved therapies.
-- Controlled manufacturing process and stable crystal form of neflamapimod
announced in March 2026 mitigate past cross-batch variability issues and
increase certainty of achieving target plasma drug concentrations in
future studies.
-- Continued momentum with recent progress, including:
-- Announcement of planned Phase 3 dosing regimen (50mg TID of stable
crystal form), as well as manufacture and release of initial Phase
3 clinical drug batch.
-- Completion of a 39-week chronic toxicity study in a non-rodent
species that increases neflamapimod's no adverse effect level
threefold and widens the safety margin to 30-fold above
clinically active plasma drug exposures.
-- Recent peer-reviewed publication validates pharmacological
approach of neflamapimod in DLB, blocking the neurotoxic effects
of neuroinflammation, consistent with data presented by CervoMed
at ADPD 2026.
Advance neflamapimod through upcoming clinical milestones in multiple rare neurological diseases
Nonfluent Variant Primary Progressive Aphasia (nfvPPA)
-- Phase 2a clinical trial designed to establish proof-of-principle of
neflamapimod in nfvPPA fully enrolled ahead of schedule.
-- Multiple near-term potential catalysts from ongoing Phase 2a trial
anticipated, including interim biomarker data in early fourth quarter of
2026 and 24-week clinical data in the first quarter of 2027.
-- Recent, peer-reviewed publication demonstrates the relevance of
p38<ALPHA> in tauopathies, including evidence that neflamapimod reverses
axonal transport deficits in mouse models of FTD-Tau.
Amyotrophic Lateral Sclerosis (ALS)
-- Anticipated initiation of Phase 2a clinical trial of neflamapimod in ALS
through the funded EXPERTS-ALS platform provides a capital-efficient
opportunity to further expand into rare neurological disease space.
-- Neflamapimod 50mg TID dose recently selected for EXPERTS-ALS Phase 2a
clinical trial.
-- On track for submission to regulatory authorities in the UK, with first
patient dosed anticipated in the fourth quarter of 2026.
Private Placement Financing
In the private placement, the Company will sell an aggregate of 3,360,377 units (the Units), each Unit comprised of (i) $(A)$ one share of its common stock or $(B)$ one pre-funded warrant to purchase shares of its common stock, (ii) one Series B warrant to purchase shares of its common stock or pre-funded warrants to purchase shares of its common stock, and (iii) one Series C warrant to purchase shares of its common stock or pre-funded warrants to purchase shares of its common stock. A Unit comprised of one share of common stock, one Series B warrant, and one Series C warrant shall have a purchase price of $3.14. A Unit comprised of one pre-funded warrant, one Series B warrant, and one Series C warrant shall have a purchase price of $3.139.
The Series B warrants have an exercise price of $3.32 per share (or $3.319 per pre-funded warrant), will be immediately exercisable, and will expire on June 11, 2031. The Series C warrants have an exercise price of $3.14 per share (or $3.139 per pre-funded warrant), will be immediately exercisable, and will expire on June 11, 2027. The pre-funded warrants have an exercise price of $0.001 per share, will be immediately exercisable, and will not expire.
The Company anticipates gross proceeds from the private placement will be approximately $10.5 million, before deducting any offering-related fees and expenses, and up to an additional approximately $21.7 million in gross proceeds if the Series B warrants and Series C warrants are fully exercised for cash. The private placement is expected to close on or about June 11, 2026, subject to customary closing conditions.
The Company intends to use the net proceeds from the private placement to fund research and development of its clinical-stage product candidate, neflamapimod, working capital and general corporate purposes. Based on the Company's current operating plan, the proceeds from this financing (together with the Company's existing cash and cash equivalents but excluding any additional proceeds that may be received upon the exercise of Series B warrants or Series C warrants), are expected to fund operations into the second quarter of 2027.
The offer and sale of the foregoing securities are being made in a transaction not involving a public offering and the securities to be sold in the private placement have not been registered under the Securities Act of 1933, as amended (Securities Act), or any state or other applicable jurisdiction's securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state or other jurisdictions' securities laws. Pursuant to the securities purchase agreement, the Company has agreed to file a registration statement with the US Securities and Exchange Commission (SEC) registering the resale of the shares of common stock issued in the private placement and the shares of common stock issuable upon the exercise of the pre-funded warrants, the Series B warrants (including upon exercise of any pre-funded warrants issued upon exercise of the Series B warrants), and the Series C warrants (including upon exercise of any pre-funded warrants issued upon exercise of the Series C warrants) issued in the private placement no later than the 45th day after the closing of the private placement.
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