Core Viewpoint - Alzamend Neuro, Inc. is set to initiate a phase II clinical study of AL001 for the treatment of bipolar disorder (BD) in Q3 2025, following successful preliminary developments [1][2] Group 1: Clinical Study and Product Development - The phase II study will be conducted in collaboration with Massachusetts General Hospital, focusing on AL001's unique properties and its lithium delivery effectiveness compared to existing lithium salts [2][3] - AL001 aims to provide targeted effectiveness with reduced systemic side effects, potentially improving treatment outcomes for BD patients [2][3] - Previous studies indicate that AL001 enhances brain absorption of lithium while maintaining lower blood levels, which could lead to safer treatment options [2][3] Group 2: Advantages of AL001 - AL001 could eliminate the need for lithium therapeutic drug monitoring (TDM), addressing a significant barrier in the treatment of BD [3][4] - The product is designed to minimize risks associated with traditional lithium therapies, such as kidney and thyroid side effects, by favorably distributing lithium in the brain [3][5] - The potential introduction of AL001 represents a significant advancement in lithium treatment, promising enhanced safety and user-friendliness for over 7 million Americans suffering from BD [4][5] Group 3: Company Overview and Pipeline - Alzamend Neuro is focused on developing innovative treatments for Alzheimer's, BD, major depressive disorder (MDD), and post-traumatic stress disorder (PTSD) [6] - The company's pipeline includes AL001, a patented lithium delivery system, and ALZN002, a cell-based therapeutic vaccine targeting Alzheimer's [6] - Both product candidates are licensed from the University of South Florida Research Foundation, indicating a strong foundation for ongoing research and development [6]

Group 1 - Alzamend Neuro, Inc. (ALZN) is a notable stock in the Medical sector, which consists of 1010 individual stocks and ranks 2 in the Zacks Sector Rank [2] - The Zacks Rank system indicates that Alzamend Neuro, Inc. has a Zacks Rank of 2 (Buy), with a significant increase of 88.2% in the consensus estimate for its full-year earnings over the past three months, reflecting improved analyst sentiment [3] - Year-to-date, Alzamend Neuro, Inc. has returned 1.7%, outperforming the Medical sector's average return of -3.3% [4] Group 2 - Alzamend Neuro, Inc. is part of the Medical - Biomedical and Genetics industry, which includes 512 companies and currently ranks 74 in the Zacks Industry Rank; this industry has an average loss of 11.9% year-to-date, indicating that ALZN is performing better [6] - Another stock in the Medical sector, Beam Therapeutics Inc. (BEAM), has also shown strong performance with a year-to-date return of 6.4% and a Zacks Rank of 2 (Buy) [4][5] - Investors in the Medical sector should monitor both Alzamend Neuro, Inc. and Beam Therapeutics Inc. for their continued solid performance [7]

Financial Results - Alzamend Neuro, Inc. reported unaudited financial results for the six months ended October 31, 2024[5]. - The report does not include specific financial figures or performance metrics in the provided content[6]. Company Classification - The company is classified as an emerging growth company under the Securities Act of 1933[4]. Press Release - The press release detailing financial results was issued on December 12, 2024[5]. Forward-Looking Statements - The company emphasizes the importance of forward-looking statements regarding its future operating results[7]. - Investors are advised to not overly rely on forward-looking statements due to inherent uncertainties and risks[7]. Company Information - The company’s principal executive office is located in Atlanta, GA[2]. - The Chief Financial Officer, David J. Katzoff, signed the report[14]. Regulatory Compliance - The report includes a cover page formatted in Inline XBRL for regulatory compliance[10]. - Additional information can be accessed through the SEC's website[9].

Product Development - Alzamend Neuro aims to develop therapeutics for Alzheimer's, bipolar disorder, major depressive disorder, and post-traumatic stress disorder, with two main product candidates: AL001 and ALZN002 [126] - AL001, a patented ionic cocrystal technology, has shown potential in preclinical studies to prevent cognitive deficits and improve memory compared to traditional lithium carbonate treatments [140] - The maximum tolerated dose for AL001 was identified as 240 mg three times daily, designed to mitigate risks for fragile populations such as Alzheimer's patients [142] - ALZN002 is an active immunotherapy vaccine designed to treat mild to moderate Alzheimer's dementia, utilizing the patient's own immune cells to combat amyloid-beta proteins [150] - A Phase I/IIA clinical trial for ALZN002 was initiated to assess safety and efficacy, with plans for a larger Phase IIB trial pending successful results [151] - Alzamend Neuro plans to initiate five clinical trials to compare lithium levels in the brain between AL001 and marketed lithium salts, aiming for lower doses with equivalent therapeutic benefits [144] - Alzamend Neuro has partnered with Massachusetts General Hospital to conduct clinical trials for AL001, enhancing its research capabilities [144] - The company has received a "study may proceed" letter from the FDA for ALZN002, indicating regulatory progress [150] - Alzamend Neuro's innovative formulations aim to provide safer long-term treatment options for neuropsychiatric and neurodegenerative conditions without the need for therapeutic drug monitoring [147] Financial Performance - Total operating expenses for the three months ended October 31, 2024, were $1,358,068, a decrease of 53% from $2,901,722 in the same period of 2023 [155] - Research and development expenses decreased by 84% to $311,088 for the three months ended October 31, 2024, compared to $1,996,783 in 2023 [158] - The net loss for the three months ended October 31, 2024, was $1,361,563, a 53% improvement from a net loss of $2,906,033 in the same period of 2023 [155] - General and administrative expenses increased by 16% to $1,046,980 for the three months ended October 31, 2024, compared to $904,939 in 2023 [163] - The company did not generate any revenue during the three months ended October 31, 2024, and does not anticipate generating revenue in the foreseeable future [156] - For the six months ended October 31, 2024, total operating expenses were $2,320,473, a decrease of 64% from $6,427,652 in the same period of 2023 [172] - The net loss available to common shares for the six months ended October 31, 2024, was $2,389,625, a 63% improvement from $6,433,799 in 2023 [172] - Research and development expenses for the six months ended October 31, 2024, were $517,659, down 88% from $4,362,920 in 2023 [172] - The company incurred marketing fees of $304,000 during the three months ended October 31, 2024, which were not present in the same period of 2023 [170] - Basic and diluted net loss per common share improved to $(1.11) for the six months ended October 31, 2024, from $(9.80) in 2023 [172] - Research and development expenses for the six months ended October 31, 2024, were $518,000, a decrease of 88% from $4.4 million in the same period of 2023 [174] - Professional fees decreased to $365,000 in the six months ended October 31, 2024, down 83% from $2.1 million in 2023 [176] - Clinical trial fees were $124,000 for the six months ended October 31, 2024, a decrease of 94% from $2.0 million in 2023 [177] - General and administrative expenses for the six months ended October 31, 2024, were $1.8 million, a decrease of 13% from $2.1 million in 2023 [180] - Salaries and benefits increased to $554,000 in the six months ended October 31, 2024, up 46% from $379,000 in 2023 [182] - The company reported net losses of $1.4 million and $2.4 million for the three and six months ended October 31, 2024, respectively [189] - As of October 31, 2024, the company had cash of $4.1 million and working capital of $3.5 million [189] Financing Activities - The company plans to finance future development activities primarily through the sale of equity securities and some debt financing [189] - On January 31, 2024, the company entered into a securities purchase agreement for up to $6 million of Series B Convertible Preferred Stock [194] - The company sold an aggregate of 2,100 shares of Series B Convertible Preferred Stock for a total purchase price of $2.1 million during the year ended April 30, 2024 [195] - Orchid has agreed to purchase 1,700 Preferred Shares based on specific milestones, including 200 shares for $2,000,000 and 100 shares for $1,000,000 monthly until all shares are sold [201] - The average closing price of common stock must be at least $2.50 for tranche closings to proceed; otherwise, closings will be delayed [202] - The Series A Convertible Preferred Stock has a stated value of $10,000 per share and accrues dividends at a rate of 15% per annum, payable quarterly [205] - During the six months ended October 31, 2024, net cash used in operating activities was $4.5 million, with a net loss of $2.4 million [211] - Net cash provided by financing activities during the same period was $8.3 million, primarily from the sale of Series A Convertible Preferred Stock [215] - The company sold 755,888 shares of common stock for gross proceeds of $1.2 million during the six months ended October 31, 2024 [209] - The company has contractual obligations to pay royalties of 4.5% on net sales for AL001 and 4% for ALZN002, with minimum royalties starting at $40,000 [217][219] - The company entered into an At-the-Market Issuance Sales Agreement to sell shares of common stock with an aggregate offering price of up to approximately $6.5 million [207] - The Registration Statement for the resale of common stock was declared effective on July 9, 2024, allowing for the issuance of shares in excess of the Nasdaq Limit [203] - The company has a milestone payment of $10,000,000 due upon FDA new drug application approval for AL001, with a payment due date of eight years from the effective date of the agreement [224]

Financial Performance - Research and development expenses decreased by 91% to $206,571 in Q3 2024 compared to $2,366,137 in Q3 2023[110] - Total operating expenses decreased by 73% to $962,405 in Q3 2024 compared to $3,525,931 in Q3 2023[110] - Net loss decreased by 72% to $974,411 in Q3 2024 compared to $3,527,766 in Q3 2023[110] - Research and development expenses decreased by 91% to $207,000 in Q3 2024 from $2.4 million in Q3 2023, primarily due to lower professional fees and no clinical trial activity[112][113] - Clinical trial fees were $0 in Q3 2024 compared to $1.2 million in Q3 2023, as the company had no clinical trial activity during the period[115] - General and administrative expenses decreased by 35% to $756,000 in Q3 2024 from $1.2 million in Q3 2023, driven by lower stock-based compensation and marketing fees[117][118] - The company had a cash balance of $1.2 million, a working capital deficiency of $1.5 million, and an accumulated deficit of $55.0 million as of July 31, 2024[125] - The company reported a net loss of $974,000 for the three months ended July 31, 2024[125] - No revenue generated in Q3 2024 or Q3 2023, with no anticipated revenue in the foreseeable future[111] - Net cash used in operating activities for the three months ended July 31, 2024 was $1.1 million, primarily due to a net loss of $974,000 and a decrease in net operating assets and liabilities of $185,000, partially offset by non-cash charges of $103,000[142] - Net cash used in investing activities for the three months ended July 31, 2024 was $90,000, primarily for the purchase of equipment related to the AL001 clinical trial[142] - Net cash provided by financing activities for the three months ended July 31, 2024 was $2.0 million from the sale of Series A Convertible Preferred Stock[144] Clinical Trials and Drug Development - AL001 achieved a maximum tolerated dose of 240 mg TID, reducing lithium dosage by 20% compared to standard lithium carbonate treatment[101][104] - ALZN002 Phase I/IIA clinical trial initiated in April 2023 to assess safety and efficacy in 20-30 subjects with mild to moderate Alzheimer's[106] - IND applications for AL001 in BD, MDD, and PTSD received "study may proceed" letters from the FDA in 2023[103] - ALZN002 is an active immunotherapy vaccine using autologous dendritic cells to target amyloid-beta proteins in Alzheimer's patients[105] - The company plans to initiate clinical trials for AL001 in 2025 at the MTD to evaluate brain lithium levels compared to marketed lithium salts[104] - The company is required to complete milestones and make payments for the AL001 and ALZN002 technologies, including $1.25 million upon the first patient treated in a Phase III clinical trial for AL001 and $1 million upon the first patient treated in a Phase III clinical trial for ALZN002[154][155] - The company has additional payment milestones for AL001, including $2 million due in March 2026 and $16 million due on August 1, 2029[156] Financing and Capital Structure - The company requires additional financing to fund future operations and clinical trials[107] - The company entered into a Series B Preferred Financing agreement with Ault Lending, allowing for the purchase of up to $6 million of Series B Convertible Preferred Stock and warrants[129] - The company sold 2,100 shares of Series B Convertible Preferred Stock and warrants for $2.1 million during the year ended April 30, 2024[130] - The company entered into a Series A Preferred Financing agreement with Orchid Finance, allowing for the purchase of up to 2,500 shares of Series A Convertible Preferred Stock and warrants[133] - The company sold 700 shares of Series A Convertible Preferred Stock and warrants for $7.0 million between May 10, 2024 and August 21, 2024[134] - Orchid Finance agreed to purchase the remaining 1,800 Series A Preferred Shares based on the company's achievement of specific milestones[135] - The Series A Convertible Preferred Stock has a stated value of $10,000 per share and accrues dividends at 15% per annum, payable quarterly in cash or paid-in-kind shares[138] - The warrants have an exercise price of $12.50 and are exercisable upon issuance with a five-year term[139] Licensing and Royalties - The AL001 License Agreements require royalty payments of 4.5% on net sales of products developed from the licensed technology, with minimum royalties starting at $40,000 on the first anniversary of the first commercial sale[146] - The ALZN002 License Agreement requires royalty payments of 4% on net sales of products developed from the licensed technology, with minimum royalties starting at $20,000 on the first anniversary of the first commercial sale[148] - The November AL001 License Agreements require royalty payments of 3% on net sales of products developed from the licensed technology, with minimum royalties starting at $40,000 on the first anniversary of the first commercial sale[150]

Company Overview - Alzamend Neuro Inc. has partnered with Massachusetts General Hospital to conduct a Phase 2 study of AL001 for treating post-traumatic stress disorder (PTSD) [1][2] - The company aims to assess the comparative increase in lithium levels in the brain compared to commonly marketed lithium salts among PTSD patients [2] Clinical Trial Details - The objective of the trial is to predict the minimum dose necessary for AL001 to achieve effectiveness and safety comparable to established lithium salts [2] - The study is expected to help meet regulatory safety standards through the Section 505(b)(2) pathway for FDA approval [2] Market Performance - Following the announcement of the partnership and clinical trial, Alzamend Neuro's stock (ALZN) increased by 267.7%, reaching $7.50 [2]

Financial Condition and Funding - As of April 30, 2024, the company had $376,000 in cash and cash equivalents, with expectations of needing substantial additional funding for ongoing clinical trials [144]. - The company has a going concern opinion from its independent registered public accounting firm, indicating substantial doubt about its ability to continue operations without additional capital [147]. - The company does not expect to generate revenue for several years, if at all, and may not achieve profitability for many years after generating material revenue [149]. - The company has identified material weaknesses in its internal control over financial reporting, which could affect the accuracy and timeliness of financial reporting [273]. - The company does not intend to pay dividends in the foreseeable future, relying instead on stock appreciation for returns on investment [272]. Clinical Trials and Product Development - The company has initiated clinical trials for AL001 and ALZN002 but has not yet completed pivotal trials or obtained marketing approvals, indicating a lack of near-term revenue [148]. - Clinical trials for AL001 and ALZN002 are expected to be expensive, time-consuming, and may face delays or termination due to various factors [187]. - The company plans to submit AL001 and ALZN002 for regulatory approval in the future, but neither has been submitted yet [162]. - Successful development, FDA approval, and commercialization of AL001 or ALZN002 are critical for the company's near-term prospects and revenue generation [162]. - The anticipated development of a Risk Evaluation and Mitigation Strategy (REMS) for AL001 or ALZN002 could cause delays in the approval process and impact market potential [205]. Regulatory and Compliance Risks - The company is required to pay a 4% royalty on net sales for ALZN002 and a 4.5% royalty for AL001, along with various milestone payments totaling up to $10 million for AL001 upon FDA approval [152]. - The reimbursement approval process is time-consuming and may significantly affect the commercial viability of AL001 and ALZN002 [175]. - Regulatory approval processes vary by country and can involve additional studies, which may delay commercialization [183]. - Failure to obtain necessary regulatory approvals could materially and adversely affect the company's business and financial condition [181]. - The company may face significant penalties if it fails to comply with ongoing FDA and regulatory body obligations after receiving approval for its products [195]. Market and Competitive Landscape - Market acceptance of AL001 and ALZN002 is uncertain and depends on factors such as safety, efficacy, physician willingness, and reimbursement from third-party payers [166]. - The company faces substantial competition from major pharmaceutical and biotechnology companies, which may have greater resources and expertise in research, development, and marketing [215]. - If competitors develop safer or more effective products, the company's commercial opportunity could be significantly reduced or eliminated [216]. - The high rate of failure for drug candidates in clinical trials could materially and adversely affect the company's business and financial condition [185]. Intellectual Property and Legal Risks - The company may need to litigate to enforce its intellectual property rights, which could be costly and distract management from core business operations [222]. - The company relies on a combination of patents and trade secret protection to safeguard its intellectual property, but there is a risk of inadequate protection [230]. - The company may face third-party claims alleging patent infringement, which could result in substantial expenses and hinder the development of its products [228]. - The company is at risk of losing its competitive edge if it cannot adequately protect its proprietary information and trade secrets [224]. Stock and Market Performance - The company was notified by Nasdaq that the minimum Market Value of Listed Securities (MVLS) for its common stock was below the $35 million requirement for continued listing [251]. - The company has until March 25, 2024, to regain compliance with the MVLS Rule [251]. - On March 26, 2024, Nasdaq determined that the company had not regained compliance, leading to a scheduled delisting on April 4, 2024 [252]. - The market price of the company's common stock has fluctuated between $6.76 and $115.95 per share during the year ended April 30, 2024 [257]. - Delisting from Nasdaq could impair the liquidity of the company's common stock and harm its ability to raise capital [255]. Operational and Management Challenges - The company has limited operating history since its incorporation in February 2016, making future operating results uncertain [150]. - The company relies heavily on senior management, particularly key individuals such as the CEO and CFO, and their loss could delay the development and commercialization of its product candidates AL001 and ALZN002 [214]. - The company anticipates difficulties in hiring qualified personnel due to intense competition in the biopharmaceutical field [280]. - Increased costs associated with operating as a public company will require management to devote substantial time to compliance initiatives and corporate governance practices [298]. Internal Control and Compliance Measures - The company is implementing measures to improve internal control over financial reporting, including formalizing documentation and strengthening supervisory reviews [275]. - There is a risk that the measures taken may not be sufficient to remediate identified material weaknesses, potentially leading to misstatements in financial statements [276]. - The company is subject to the Sarbanes-Oxley Act, requiring effective internal controls over financial reporting, which may incur significant costs and management efforts [291].

Product Development - Alzamend Neuro aims to develop therapeutics for Alzheimer's, bipolar disorder, major depressive disorder, and post-traumatic stress disorder, with two main product candidates: AL001 and ALZN002[101]. - AL001 has shown positive preclinical results, preventing cognitive deficits and improving memory compared to lithium carbonate, with a maximum tolerated dose identified at 240 mg three times daily[112][113]. - The company plans to initiate two safety and efficacy clinical trials for AL001 in Alzheimer's patients, with Investigational New Drug applications submitted for bipolar disorder, major depressive disorder, and post-traumatic stress disorder[115]. - ALZN002 is an active immunotherapy vaccine designed to treat mild to moderate dementia of the Alzheimer's type, with a Phase I/IIA clinical trial initiated in April 2023[118][119]. - Alzamend's strategy includes advancing clinical development and exploring additional indications for its product candidates[111]. Financial Performance - Total operating expenses for the three months ended January 31, 2024, were $2.66 million, a decrease of 51% from $5.42 million in the same period of 2023[125]. - Research and development expenses decreased by 34% to $1.91 million for the three months ended January 31, 2024, compared to $2.89 million in 2023[125]. - The net loss for the three months ended January 31, 2024, was $2.66 million, a reduction of 51% from a net loss of $5.43 million in the same period of 2023[125]. - No revenue was generated during the three months ended January 31, 2024, and the company does not anticipate generating revenue in the foreseeable future[126]. - General and administrative expenses for the three months ended January 31, 2024, were $751,000, down 70% from $2.53 million in 2023[133]. - Clinical trial fees for the three months ended January 31, 2024, were $1.25 million, a decrease of 39% from $2.05 million in 2023[130]. - For the nine months ended January 31, 2024, total operating expenses were $9.09 million, a decrease of 21% from $11.57 million in the same period of 2023[141]. - Research and development expenses for the nine months ended January 31, 2024, were $6.27 million, an increase of 8% from $5.80 million in 2023[143]. - The company incurred a net loss of $9.1 million for the nine months ended January 31, 2024, compared to a net loss of $6.7 million for the same period in 2023[156]. - The company reported general and administrative expenses of $2.8 million for the nine months ended January 31, 2024, a decrease of 51% from $5.8 million in the prior year[150]. - Clinical trial fees increased to $3.3 million for the nine months ended January 31, 2024, up from $2.6 million in the same period in 2023, with $1.9 million allocated to the Phase IIA clinical trial for AL001[147]. - Stock-based compensation expense decreased to $660,000 for the nine months ended January 31, 2024, down 79% from $3.1 million in the prior year[152]. Compliance and Regulatory Issues - Alzamend received a deficiency letter from Nasdaq on September 26, 2023, indicating that the market value of its listed securities fell below the $35 million requirement for continued listing[121]. - The company has until March 25, 2024, to regain compliance with the Nasdaq listing rule by maintaining a market value of $35 million or more for at least 10 consecutive business days[121]. - Nasdaq issued a Deficiency Letter due to the Common Stock bid price closing below $1.00 for 30 consecutive business days, with a compliance deadline of July 30, 2024[122]. Funding and Capital Structure - As of January 31, 2024, the company had cash of $283,000 and a working capital deficiency of $3.2 million[157]. - The company sold 816,426 shares of Common Stock for gross proceeds of $1.0 million during the nine months ended January 31, 2024, as part of an At-the-Market Offering[161]. - The company entered into an agreement to sell up to $6 million of Series B Convertible Preferred Stock, with the first closing resulting in $1.22 million raised[162]. - Net cash used in operating activities was $6.8 million for the nine months ended January 31, 2024, primarily due to the net loss[168]. - The company plans to finance future development activities largely through the sale of equity securities and additional debt financing[157]. - The company has not been able to initiate Phase II clinical trials for AL001 due to insufficient financing[159]. Licensing and Royalties - AL001 License Agreements require combined royalty payments of 4.5% on net sales, with minimum royalties starting at $40,000 in the first year[171]. - ALZN002 License Agreement mandates 4% royalty on net sales, with minimum royalties beginning at $20,000 in the first year[174]. - November AL001 License Agreements stipulate 3% royalty on net sales, with minimum royalties starting at $40,000 in the first year[176]. - Total milestone payments for AL001 technologies include $1,250,000 due in March 2025 upon first patient treated in a Phase III clinical trial[178]. - ALZN002 License includes milestone payments of $1,000,000 upon first patient treated in a Phase III clinical trial[180]. - Additional AL001 licenses require a payment of $2,000,000 due in March 2026 upon first patient treated in a Phase III clinical trial[181]. - The company has paid an initial license fee of $200,000 for both AL001 and ALZN002 licenses[173][174]. - The Licensor received 148,528 shares for AL001 and 240,120 shares for ALZN002 as part of the licensing agreements[173][174]. - The AL001 and ALZN002 licenses have indefinite terms until certain conditions are met, including the expiration of patent rights[177]. - The company has entered multiple amendments to the ALZN002 License Agreement, modifying payment timing[173].

Product Development - Alzamend Neuro aims to develop therapeutics for Alzheimer's, bipolar disorder, major depressive disorder, and post-traumatic stress disorder, with two main product candidates: AL001 and ALZN002[96]. - AL001 has shown positive preclinical results, preventing cognitive deficits and improving memory compared to lithium carbonate, with a maximum tolerated dose identified at 240 mg three times daily[105][106]. - The company plans to initiate two safety and efficacy clinical trials for AL001 in patients with mild to moderate Alzheimer's, with Investigational New Drug applications submitted for bipolar disorder, major depressive disorder, and PTSD[109]. - ALZN002 is an active immunotherapy vaccine designed to treat mild to moderate Alzheimer's, with a Phase I/IIA clinical trial initiated in April 2023 to assess safety and efficacy[112]. - The company has a focus on advancing clinical development and expanding its pharmaceutical pipeline to include additional indications for AL001[104]. - Alzamend Neuro's strategy includes optimizing the value of its product candidates in major markets and pursuing translational and functional endpoints for efficient development[104]. Financial Performance - Research and development expenses for the three months ended October 31, 2023, were $2.0 million, a 30% increase from $1.5 million in the same period of 2022[119]. - General and administrative expenses decreased by 42% to $905,000 for the three months ended October 31, 2023, compared to $1.6 million in the prior year[126]. - The net loss for the three months ended October 31, 2023, was $2.9 million, a 7% improvement from a net loss of $3.1 million in the same period of 2022[117]. - The company did not generate any revenue during the three months ended October 31, 2023, and does not anticipate generating revenue in the foreseeable future[118]. - Clinical trial fees increased by 44% to $795,000 for the three months ended October 31, 2023, compared to $552,000 in the same period of 2022[123]. - Total operating expenses for the three months ended October 31, 2023, were $2.9 million, a 7% decrease from $3.1 million in the prior year[117]. - The basic and diluted net loss per common share improved to $(0.44) for the three months ended October 31, 2023, from $(0.48) in the same period of 2022[117]. - Research and development expenses for the six months ended October 31, 2023, were $4.4 million, a 50% increase from $2.9 million in the same period of 2022[136]. - The total net loss for the six months ended October 31, 2023, was $6.4 million, a 5% increase from $6.1 million in the same period of 2022[133]. - The company incurred professional fees of $2.1 million for the six months ended October 31, 2023, consistent with the previous year[138]. - Clinical trial fees for the six months ended October 31, 2023, increased to $2.0 million from $575,000 in the same period of 2022, with $1.4 million allocated to the Phase IIA clinical trial for AL001 and $650,000 for ALZN002[139]. - General and administrative expenses decreased by 36% to $2.1 million for the six months ended October 31, 2023, compared to $3.2 million in 2022[144]. - Stock-based compensation expense for general and administrative purposes dropped by 66% to $545,000 in the six months ended October 31, 2023, from $1.6 million in the prior year[146]. - Net cash used in operating activities was $4.8 million for the six months ended October 31, 2023, compared to $4.9 million in the same period of 2022[158]. - The company reported a net loss of $6.4 million for the six months ended October 31, 2023, compared to a loss of $2.9 million for the three months ended October 31, 2023[151]. - As of October 31, 2023, the company had cash of $200,000 and an accumulated deficit of $50.5 million[151]. Capital and Compliance - Alzamend Neuro requires additional capital to fund ongoing clinical trials and operations, as progress depends on various factors including regulatory approvals and competitive landscape[113]. - As of September 26, 2023, Alzamend Neuro received a notice from Nasdaq regarding non-compliance with the minimum Market Value of Listed Securities requirement, needing to regain compliance by March 25, 2024[114]. - The company sold 6,149 shares of Common Stock for gross proceeds of $19,000 during the six months ended October 31, 2023, and an additional 651,046 shares for $849,000 from November 1, 2023, to December 14, 2023[154]. - The company incurred $147,000 in cash used for investing activities, primarily for the purchase of machinery and equipment for clinical trials[159]. - The company has entered into an At-the-Market Issuance Sales Agreement to sell shares of Common Stock with an aggregate offering price of up to approximately $9.8 million[153]. Licensing and Royalties - The AL001 License Agreements require combined royalty payments of 4.5% on net sales of products developed from the licensed technology, with minimum royalties starting at $40,000 on the first anniversary of the first commercial sale[162]. - The ALZN002 License Agreement requires royalty payments of 4% on net sales of products developed from the licensed technology[164]. - An initial license fee of $200,000 was paid for ALZN002, along with 240,120 shares of common stock as an additional licensing fee[164]. - Minimum royalties for ALZN002 are set at $20,000 on the first anniversary, $40,000 on the second anniversary, and $50,000 on the third anniversary of the first commercial sale[164]. - The November AL001 License Agreements require royalty payments of 3% on net sales of products developed from the licensed technology[166]. - An initial license fee of $20,000 was paid for the additional indications under the November AL001 License Agreements[166]. - Minimum royalties for the November AL001 License Agreements are $40,000 on the first anniversary, $80,000 on the second anniversary, and $100,000 on the third anniversary of the first commercial sale[166]. - Milestone payments for AL001 include $1,250,000 due in March 2025 upon the first patient treated in a Phase III clinical trial[168]. - A total of $10,000,000 is due upon FDA NDA approval for the AL001 technology[168]. - For ALZN002, a payment of $10,000,000 is due upon the first commercial sale[169]. - Additional AL001 licenses include a payment of $16,000,000 due on August 1, 2029, upon the first commercial sale[170].

Product Development - The company aims to develop therapeutics for Alzheimer's, bipolar disorder, major depressive disorder, and post-traumatic stress disorder, with two main product candidates: AL001 and ALZN002[84]. - AL001 has shown positive preclinical results, preventing cognitive deficits and improving memory compared to traditional lithium carbonate treatments, with a maximum tolerated dose of 240 mg three times daily established[95][94]. - The company plans to file Investigational New Drug applications for AL001 targeting bipolar disorder, major depressive disorder, and post-traumatic stress disorder by the end of 2023[98]. - ALZN002 is an active immunotherapy vaccine designed to treat mild to moderate Alzheimer's dementia, with a Phase I/IIA clinical trial initiated in April 2023[101]. - The company has received FDA approval to proceed with clinical trials for both AL001 and ALZN002, indicating progress in its development pipeline[100][99]. Financial Performance - The company did not generate any revenue during the three months ended July 31, 2023, and does not anticipate generating revenue in the foreseeable future[106]. - Net loss for Q3 2023 was $3.53 million, a 16% increase from a net loss of $3.04 million in Q3 2022[120]. - Cash used in operating activities for Q3 2023 was $3.30 million, compared to $2.54 million in Q3 2022[127]. - The company had cash of $1.7 million and an accumulated deficit of $47.6 million as of July 31, 2023[121]. Research and Development - The company’s research and development expenses are recognized as incurred, reflecting its commitment to advancing its therapeutic candidates[85]. - Research and development expenses increased by 72% to $2.37 million in Q3 2023 from $1.38 million in Q3 2022[108]. - Clinical trial fees surged to $1.25 million in Q3 2023 from $24,000 in Q3 2022, reflecting a 5,198% increase[110]. Operational Expenses - General and administrative expenses decreased by 30% to $1.16 million in Q3 2023 from $1.66 million in Q3 2022[114]. - Stock-based compensation expense decreased by 57% to $369,000 in Q3 2023 from $867,000 in Q3 2022[116]. Capital Requirements - The company requires additional capital to fund ongoing clinical trials and operations, as working capital needs depend on various factors including regulatory approvals and competitive landscape[102]. - The company plans to finance future development activities primarily through the sale of equity securities[121]. - The company entered into a Sales Agreement to sell up to approximately $9.8 million in shares of common stock through an ATM Offering[123]. Licensing Agreements - The AL001 License Agreements require combined royalty payments of 4.5% on net sales of products developed from the licensed technology[130]. - An initial license fee of $200,000 has been paid for AL001, and the Licensor received 2,227,923 shares of common stock as an additional licensing fee[130]. - Minimum royalties for AL001 are set at $40,000 on the first anniversary, $80,000 on the second anniversary, and $100,000 on the third anniversary of the first commercial sale[130]. - The ALZN002 License Agreement mandates royalty payments of 4% on net sales, with an initial license fee of $200,000 already paid[132]. - Minimum royalties for ALZN002 are $20,000 on the first anniversary, $40,000 on the second anniversary, and $50,000 on the third anniversary of the first commercial sale[132]. - The November AL001 License Agreements require royalty payments of 3% on net sales, with an initial license fee of $20,000 paid for the additional indications[134]. - Minimum royalties for the November AL001 License Agreements are $40,000 on the first anniversary, $80,000 on the second anniversary, and $100,000 on the third anniversary of the first commercial sale[134]. - Milestone payments for the AL001 technologies include $10,000,000 upon FDA NDA approval, due 8 years from the effective date of the agreement[136]. - For ALZN002, a milestone payment of $1,000,000 is due upon the first patient treated in a Phase III clinical trial, 12 months from the completion of the first Phase II clinical trial[137]. - Additional AL001 Licenses include a payment of $16,000,000 due on August 1, 2029, upon the first commercial sale[138].