CASSAVA SCIENCES INC

Previous wording

Please also refer to the section entitled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, as such risk factors may be further amended, updated or modified periodically in our reports filed with the U.S. Securities and Exchange Commission (the “SEC”) for further information on these and other risks affecting us.

Current wording

Please also refer to the section entitled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and this Quarterly Report on Form 10-Q, as such risk factors may be further amended, updated or modified periodically in our reports filed with the U.S. Securities and Exchange Commission (the “SEC”) for further information on these and other risks affecting us.

Previous wording

We combine innovative technology with new insights in neurobiology to develop novel solutions targeting central nervous system disorders, such as TSC-related epilepsy. Our strategy is to leverage our unique scientific/clinical platform to develop first-in-class programs for treating central nervous system disorders. In addition, we are in the early stages of exploring potential artificial intelligence (“AI”) capabilities and related data analytics to target improvements in productivity and efficiency in our business, enhancements to research and development activities, and advancements in statistical analysis capabilities.

Current wording

We combine innovative technology with new insights in neurobiology to develop novel solutions targeting central nervous system disorders, such as TSC-related epilepsy. Our strategy is to leverage our unique scientific/clinical platform to develop first-in-class programs for treating central nervous system disorders.

Previous wording

We solely own patents covering the composition of matter of our drug simufilam in the United States, Europe, Australia, Israel and Canada. We solely own patents covering certain methods of use of our drug simufilam in the United States, Europe and Japan. We solely own pending patent applications that cover diagnostic assets for simufilam in the United States, Europe, Japan, China, Canada, and Australia. We solely own pending patent applications that cover other diagnostic assets in the United States, Europe, Japan, China and Canada. We have no obligation to pay any royalty to any third party in connection with any of the foregoing described patents and patent applications. In the United States, our patent protection with respect to simufilam, its solid forms, and uses of simufilam for Alzheimer’s disease and other neurodegenerative diseases includes nine issued United States patents, with terms expiring on dates ranging from 2029 to 2040, subject to any patent extensions that may be available for such patents. Corresponding foreign filings have been made for each of the Unites States filings.

Current wording

We solely own patents covering the composition of matter of our drug simufilam in the United States, Europe, Australia, Israel and Canada. We solely own patents covering certain methods of use of our drug simufilam in the United States, Europe and Japan. We solely own pending patent applications that cover diagnostic assets for simufilam in the United States, Europe, Japan, China, Canada, and Australia. We solely own pending patent applications that cover other diagnostic assets in the United States, Europe, Japan, China and Canada. We have no obligation to pay any royalty to any third party in connection with any of the foregoing described patents and patent applications. In the United States, our patent protection with respect to simufilam, its solid forms, and uses of simufilam for Alzheimer’s disease and other neurodegenerative diseases includes nine issued United States patents, with terms expiring on dates ranging from 2029 to 2040, subject to any patent extensions that may be available for such patents. Corresponding foreign filings have been made for each of the United States filings.

Previous wording

Based on the results of these studies, the Company is planning to file an Investigational New Drug (“IND”) application in order to initiate a proof-of-concept clinical trial for simufilam in TSC-related epilepsy. This first clinical study for simufilam in TSC-related epilepsy is expected to begin in first-half 2026. In connection with the initiation of this clinical program, the Company appointed Dr. Joseph Hulihan as Chief Medical Officer. Dr. Hulihan, who brings over 25 years of industry experience, will devote approximately half of his professional time to Cassava and will advise on this clinical development of simufilam.

Current wording

Based on the results of these studies, the Company has filed an Investigational New Drug (“IND”) application in order to initiate a proof-of-concept clinical trial for simufilam in TSC-related epilepsy. This first clinical study for simufilam in TSC-related epilepsy is expected to begin in first-half 2026. In connection with the initiation of this clinical program, the Company appointed Dr. Joseph Hulihan as Chief Medical Officer in August 2025. Dr. Hulihan, who brings over 25 years of industry experience, will devote approximately half of his professional time to Cassava and will advise on this clinical development of simufilam.

Previous wording

We believe simufilam may present an opportunity to potentially reduce seizures in patients with TSC. Preclinical studies in a mouse model indicate that simufilam reduces seizure activity and limits neuronal abnormalities in a manner similar to genetically normalizing FLNA levels, but without lowering the level of FLNA in the brain.

Current wording

We believe simufilam may present an opportunity to potentially reduce seizures in patients with TSC. Preclinical studies in a mouse model indicate that simufilam reduces seizure activity and limits neuronal abnormalities in a manner similar to genetically normalizing FLNA levels, but without lowering the level of FLNA in the brain. A second study in a well-accepted mouse model of TSC-related epilepsy showed that treatment with simufilam attenuated the progression of seizure activity.

Previous wording

We intend to continue exploratory preclinical studies in collaboration with the TSCA and other researchers to better understand simufilam’s potential as a treatment for TSC-related seizures. The Company also intends to submit an IND application in respect of a proof-of-concept clinical trial for simufilam in TSC-related epilepsy.

Current wording

We intend to continue exploratory preclinical studies in collaboration with the TSCA and other researchers to better understand simufilam’s potential as a treatment for TSC-related seizures. The Company has submitted an IND application in respect of a proof-of-concept clinical trial for simufilam in TSC-related epilepsy.

Previous wording

We have yet to generate any revenues from product sales. We have an accumulated deficit of $472.7 million at June 30, 2025. These losses have resulted principally from costs incurred in connection with research and development activities, salaries and other personnel-related costs, legal related costs and general corporate expenses. Research and development activities include costs of clinical and preclinical trials as well as clinical supplies associated with our product candidates. Salaries and other personnel-related costs include stock-based compensation associated with stock options and other equity awards granted to employees and non-employees. Our operating results may fluctuate substantially from period to period as a result of enrollment rates of clinical trials for our product candidates, timing of preclinical activities and our need for clinical supplies.

Current wording

We have yet to generate any revenues from product sales. We have an accumulated deficit of $483.5 million at September 30, 2025. These losses have resulted principally from costs incurred in connection with research and development activities, salaries and other personnel-related costs, legal related costs and general corporate expenses. Research and development activities include costs of clinical and preclinical trials as well as clinical supplies associated with our product candidates. Salaries and other personnel-related costs include stock-based compensation associated with stock options and other equity awards granted to employees and non-employees. Our operating results may fluctuate substantially from period to period as a result of enrollment rates of clinical trials for our product candidates, timing of preclinical activities and our need for clinical supplies.

Previous wording

There have been no material changes to our critical accounting estimates during the six months ended June 30, 2025 from those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on March 3, 2025.

Current wording

There have been no material changes to our critical accounting estimates during the nine months ended September 30, 2025 from those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on March 3, 2025.

Previous wording

Results of Operations–** Three and Six Months Ended June 30, 2025 and 2024**

Current wording

Results of Operations–** Three and Nine Months Ended September 30, 2025 and 2024**

Previous wording

Research and development expenses were $5.1 million and $15.2 million during the three months ended June 30, 2025 and 2024, respectively. This 66% decrease was due primarily to the phase out of the Alzheimer's disease development program, which was completed in the second quarter of 2025.

Current wording

Research and development expenses were $4.0 million and $17.7 million during the three months ended September 30, 2025 and 2024, respectively. This 78% decrease was due primarily to the phase out of the Alzheimer's disease development program, which was completed in the second quarter of 2025.

Previous wording

Research and development expenses were $18.8 million and $31.4 million during the six months ended June 30, 2025 and 2024, respectively. This 40% decrease was due primarily to the phase out of the Alzheimer's disease development program beginning the fourth quarter of 2024 and completed in the second quarter of 2025. This decrease was partially offset by a $1.6 million increase in stock-based compensation expense due to new awards granted in the third quarter of 2024.

Current wording

Research and development expenses were $22.7 million and $49.1 million during the nine months ended September 30, 2025 and 2024, respectively. This 54% decrease was due primarily to the phase out of the Alzheimer's disease development program beginning the fourth quarter of 2024 and completed in the second quarter of 2025. This decrease was partially offset by a $1.2 million increase in stock-based compensation expense due to new awards granted in the third quarter of 2024.

Previous wording

General and administrative expenses were $40.3 million and $46.2 million during the three months ended June 30, 2025 and 2024, respectively. The 13% decrease was due primarily to a $40.0 million SEC-related loss contingency recorded in 2024, compared to a $31.3 million securities litigation loss contingency recorded in 2025. General and administrative expense in the second quarter of 2025 included approximately $3.6 million of legal related fees/costs as well as $3.4 million in non-cash stock based compensation expense.

Current wording

General and administrative expenses were $7.9 million and $12.9 million during the three months ended September 30, 2025 and 2024, respectively. The 39% decrease was due primarily to a $2.5 million decrease in legal related costs compared to the prior year period. In addition, compensation costs decreased $1.3 million as severance costs recorded in the prior year period were not repeated in 2025. General and administrative expense in the third quarter of 2025 included approximately $3.2 million of legal related fees/costs as well as $3.1 million in non-cash stock-based compensation expense.

Previous wording

General and administrative expenses were $51.2 million and $49.9 million during the six months ended June 30, 2025 and 2024, respectively. The 3% increase was due primarily to a $40.0 million SEC-related loss contingency recorded in 2024 being partially offset by $8.8 million in insurance recoveries. This compared to a $31.3 million securities litigation loss contingency recorded in 2025, for which there were no insurance recoveries. The change also included a $3.3 million increase in stock-based compensation expense due to new awards granted in late 2024.

Current wording

General and administrative expenses were $59.1 million and $62.9 million during the nine months ended September 30, 2025 and 2024, respectively. The 6% decrease was due primarily to a $40.0 million SEC-related loss contingency recorded in 2024 being partially offset by $9.9 million in insurance recoveries. This compared to a $31.3 million securities litigation loss contingency recorded in 2025, for which there were no insurance recoveries. The change also included a $2.5 million increase in stock-based compensation expense due to new awards granted in late 2024, as well as cost decreases as severance costs recorded in the prior year period were not repeated in 2025.

Previous wording

We expect general and administrative expense will decrease significantly in future quarters. However, we expect general and administrative expense to remain high compared to historic levels due to professional fees, legal expense and potential settlements related to ongoing litigation. In addition, stock-based compensation expense is expected to be higher than historic levels due to new awards granted in 2024 and 2025.

Current wording

We expect general and administrative expense will decrease significantly in future periods. However, we expect general and administrative expense to remain high compared to historic levels due to professional fees, legal expense and potential settlements related to ongoing litigation. In addition, stock-based compensation expense is expected to be higher than historic levels due to new awards granted in 2024 and 2025.

Previous wording

Interest income was $1.2 million and $2.3 million during the three months ended June 30, 2025 and 2024, respectively. The decrease in interest income was due primarily to lower interest rates and cash balances in 2025 compared to 2024.

Current wording

Interest income was $1.2 million and $2.6 million during the three months ended September 30, 2025 and 2024, respectively. The decrease in interest income was due primarily to lower interest rates and cash balances in 2025 compared to 2024.

Previous wording

Interest income was $2.5 million and $4.1 million during the six months ended June 30, 2025 and 2024, respectively. The decrease in interest income was due primarily to lower interest rates and cash balances in 2025 compared to 2024.

Current wording

Interest income was $3.6 million and $6.7 million during the nine months ended September 30, 2025 and 2024, respectively. The decrease in interest income was due primarily to lower interest rates and cash balances in 2025 compared to 2024.

Previous wording

There were no common stock warrants outstanding or change in fair value of warrants for the three months ended June 30, 2025. The change in fair value of warrants was $65.1 million for the three months ended June 30, 2024.

Current wording

There were no common stock warrants outstanding or change in fair value of warrants for the three months ended September 30, 2025 and 2024.

Previous wording

There were no common stock warrants outstanding or change in fair value of warrants for the six months ended June 30, 2025. The change in fair value of warrants was $108.2 million for the six months ended June 30, 2024.

Current wording

There were no common stock warrants outstanding or change in fair value of warrants for the nine months ended September 30, 2025. The change in fair value of warrants was $108.2 million for the nine months ended September 30, 2024.

Previous wording

We record the activities related to leasing office space to third parties in buildings we own as other income, net, as leasing is not core to the Company’s operations. Other income (loss), net, was $(46,000) and $0.1 million during the three months ended June 30, 2025 and 2024, respectively.

Current wording

We record the activities related to leasing office space to third parties in buildings we own as other income, net, as leasing is not core to the Company’s operations. Other income (loss), net, was $(0.1) million and $0.1 million during the three months ended September 30, 2025 and 2024, respectively.

Previous wording

Other income (loss), net, was $(0.1) million and $0.3 million during the six months ended June 30, 2025 and 2024, respectively.

Current wording

Other income (loss), net, was $(0.2) million and $0.3 million during the nine months ended September 30, 2025 and 2024, respectively.

Previous wording

We recorded other loss in the three and six months ended June 30, 2025 as due to higher vacancy rates in 2025 compared to the prior year period. We expect other loss to increase in future periods due to the impact of higher vacancy rates on rental income.

Current wording

We recorded other loss in the three and nine months ended September 30, 2025 as due to higher vacancy rates in 2025 compared to the prior year period. We expect other losses to continue in future periods due to the impact of higher vacancy rates on rental income.

Previous wording

Since inception, we have financed our operations primarily through public and private stock offerings, payments received under collaboration agreements and interest earned on our cash and cash equivalents balances. We intend to continue to use our capital resources to fund research and development activities, capital expenditures, working capital requirements and other general corporate purposes. As of June 30, 2025, cash and cash equivalents were $112.4 million.

Current wording

Since inception, we have financed our operations primarily through public and private stock offerings, payments received under collaboration agreements and interest earned on our cash and cash equivalents balances. We intend to continue to use our capital resources to fund research and development activities, capital expenditures, working capital requirements and other general corporate purposes. As of September 30, 2025, cash and cash equivalents were $106.1 million.

Previous wording

Net cash used in operating activities was $16.3 million for the six months ended June 30, 2025, resulting primarily from a net loss of $67.6 million. This change was partially offset by an increase in accrued development expense of $1.3 million, an increase in accounts payable and accrued expenses of $35.2 million and a decrease in prepaid and other current assets of $5.5 million. There was also a non-cash adjustment for stock-based compensation expense of $9.8 million.

Current wording

Net cash used in operating activities was $22.5 million for the nine months ended September 30, 2025, resulting primarily from a net loss of $78.4 million as well as a decrease in accrued development expense of $1.1 million. This change was partially offset by an increase in accounts payable and accrued expenses of $38.1 million and a decrease in prepaid and other current assets of $5.1 million. There was also a non-cash adjustment for stock-based compensation expense of $14.2 million.

Previous wording

Net cash used in operating activities was $37.4 million for the six months ended June 30, 2024, resulting primarily from the net income of $31.2 million, stock-based compensation expense of $4.9 million and an increase in accounts payable and accrued expenses of $42.0 million, offset by a change in fair value of warrants of $108.2 million, an decrease in accrued developmental expenses of $1.4 million and a decrease in in prepaid and other current assets of $6.3 million.

Current wording

Net cash used in operating activities was $55.7 million for the nine months ended September 30, 2024, resulting primarily from a change in fair value of warrants of $108.2 million and a decrease in prepaid and other current assets of $5.1 million. These changes were partially offset by net income of $3.3 million, stock-based compensation expense of $10.5 million, an increase in accounts payable and accrued expenses of $41.7 million and an increase in accrued compensation and benefits of $1.8 million.

Previous wording

Net cash used in investing activities during the six months ended June 30, 2024 was $29,000 for computers, equipment and other assets.

Current wording

Net cash used in investing activities during the nine months ended September 30, 2024 was $46,000 for computers and equipment and other assets.

Previous wording

Net cash provided by financing activities during the six months ended June 30, 2025 was $0.1 million of proceeds from the exercise of stock options.

Current wording

Net cash provided by financing activities during the nine months ended September 30, 2025 was $0.1 million of proceeds from the exercise of stock options.

Previous wording

Net cash provided by financing activities during the six months ended June 30, 2024 was $123.6 million of net proceeds from the exercise of warrants.

Current wording

Net cash provided by financing activities during the nine months ended September 30, 2024 was $123.6 million of net proceeds from the exercise of warrants.

Previous wording

We own an office complex in Austin, Texas, a portion of which serves as our corporate headquarters. Maintenance, physical facilities, leasing, property management and other key responsibilities related to property ownership are outsourced to professional real-estate managers. The office complex measures approximately 90,000 rentable square feet. At June 30, 2025, we occupied approximately 25% of the property with the remainder either leased or available for lease to third parties. Most tenant leases expired in 2024. We expect to record a net loss on leasing activities in 2025 as the higher vacancy rates are expected to significantly lower rental income.

Current wording

We own an office complex in Austin, Texas, a portion of which serves as our corporate headquarters. Maintenance, physical facilities, leasing, property management and other key responsibilities related to property ownership are outsourced to professional real-estate managers. The office complex measures approximately 90,000 rentable square feet. At September 30, 2025, we occupied approximately 25% of the property with the remainder either leased or available for lease to third parties. Most tenant leases expired in 2024 and the vacant space has not been fully replaced with new tenant leases in 2025. Thus, we expect to record a net loss on leasing activities in 2025 as the higher vacancy rates are expected to significantly lower rental income.

Previous wording

We have an accumulated deficit of $472.7 million as of June 30, 2025. We expect our cash requirements to be significant in the future. The amount and timing of our future cash requirements will depend on regulatory and market acceptance of our drug candidates, the resources we devote to researching and developing, formulating, manufacturing, commercializing and supporting our products and other corporate needs. We believe that our current cash and cash equivalents will be sufficient to fund our operations for at least the next 12 months. We may seek additional future funding through public or private financing in the future, if such funding is available and on terms acceptable to us. However, there are no assurances that additional financing will be available on favorable terms, or at all.

Current wording

We have an accumulated deficit of $483.5 million as of September 30, 2025. We expect our cash requirements to be significant in the future. The amount and timing of our future cash requirements will depend on regulatory and market acceptance of our drug candidates, the resources we devote to researching and developing, formulating, manufacturing, commercializing and supporting our products and other corporate needs. We believe that our current cash and cash equivalents will be sufficient to fund our operations for at least the next 12 months. We may seek additional future funding through public or private financing in the future, if such funding is available and on terms acceptable to us. However, there are no assurances that additional financing will be available on favorable terms, or at all.