UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

For the fiscal year ended December 31, 2022

OR

Commission File Number 001-39311

e

CEREVEL THERAPEUTICS HOLDINGS, INC.

(Exact name of Registrant as specified in its Charter)

Registrant’s telephone number, including area code: (844) 304-2048

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES ☐ No ☒

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. YES ☐ No ☒

Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ NO ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ NO ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐ NO ☒

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant, based on the closing price of shares of the Registrant’s common stock on The NASDAQ Stock Market LLC on June 30, 2022, was $1,576.0 million.

The number of shares of Registrant’s common stock outstanding as of February 10, 2023 was 156,656,668.

Portions of the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 are incorporated by reference into Part I of this Annual Report on Form 10-K to the extent stated herein.

The Registrant intends to file a definitive proxy statement pursuant to Regulation 14A relating to the 2023 Annual Meeting of Stockholders within 120 days of the end of the Registrant’s fiscal year ended December 31, 2022. Portions of such definitive proxy statement are incorporated by reference into Part III of this Annual Report on Form 10-K to the extent stated herein.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this Annual Report on Form 10-K, or this Annual Report, may constitute “forward-looking statements” for purposes of the federal securities laws. Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would,” “can,” “target,” “future,” or the negative of these terms or similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this Annual Report may include, for example, statements about:

The forward-looking statements contained in this Annual Report are based on current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described in the section titled “Risk Factors” set forth in Part I, Item 1A of this Annual Report. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Some of these risks and uncertainties may in the future be amplified by the ongoing COVID-19 pandemic, including as a result of the emergence of new variants or subvariants, and there may be additional risks that we consider immaterial or which are unknown. It is not possible to predict or identify all such risks. We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

You should read this Annual Report completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

This Annual Report contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed as exhibits to this Annual Report. Unless the context otherwise requires, reference in this Annual Report to the terms “Cerevel,” “the Company,” “we,” “us,” “our,” and similar designations refer to Cerevel Therapeutics Holdings, Inc. and where appropriate, our consolidated subsidiaries.

This Annual Report contains references to trademarks, trade names and service marks belonging to other entities. Solely for convenience, trademarks, trade names and service marks referred to in this Annual Report may appear without the ® or TM symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. We do not intend our use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

 

SUMMARY OF MATERIAL RISKS ASSOCIATED WITH OUR BUSINESS

Our business is subject to numerous risks and uncertainties that you should be aware of before making an investment decision, including those highlighted in the section entitled “Risk Factors.” These risks include, but are not limited to, the following:

The risks described above should be read together with the text of the full risk factors discussed in the section entitled “Risk Factors” and the other information set forth in this Annual Report, including our consolidated financial statements and the related notes, as well as in other documents that we file with the Securities and Exchange Commission, or the SEC. The risks summarized above or described in full elsewhere in this Annual Report are not the only risks that we face. Additional risks and uncertainties not presently known to us, or that we currently deem to be immaterial may also materially adversely affect our business, financial condition, results of operations and future growth prospects.

Table of Contents

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PART I

Item 1. Business.

Overview

We are a clinical-stage biopharmaceutical company pursuing a targeted approach to neuroscience that combines a deep understanding of disease-related biology and neurocircuitry of the brain with advanced chemistry and central nervous system, or CNS, target receptor selective pharmacology to discover and design new therapies. We seek to transform the lives of patients through the development of new therapies for neuroscience diseases, including schizophrenia, Alzheimer's disease psychosis, epilepsy, panic disorder and Parkinson’s disease. We are advancing our extensive and diverse pipeline with numerous clinical trials underway or planned, including three ongoing Phase 3 trials and an open-label extension trial for tavapadon in Parkinson's, two ongoing Phase 2 trials and an open-label extension trial for emraclidine in schizophrenia and an ongoing Phase 2 proof-of-concept trial and an open-label extension trial for darigabat in focal epilepsy. See “—Our Pipeline” below. We have built a highly experienced team of senior leaders and neuroscience drug developers who combine a nimble, results-driven biotech mindset with the proven expertise of large pharmaceutical company experience and capabilities in drug discovery and development.

Our portfolio of product candidates is based on a differentiated approach to addressing neuroscience diseases, which incorporates three key pillars: (1) targeted neurocircuitry, where we seek to unlock new treatment opportunities by precisely identifying and targeting the neurocircuit that underlies a given neuroscience disease, (2) targeted receptor subtype selectivity, where we selectively target the receptor subtype(s) related to the disease physiology to minimize undesirable off-target effects while maximizing activity and (3) differentiated pharmacology, where we design full and partial agonists, antagonists and allosteric modulators to precisely fine-tune the receptor pharmacology and neurocircuit activity to avoid over-activation or over-suppression of the endogenous physiologic range. In addition, our portfolio is supported by robust data packages and rigorous clinical trial execution designed to elucidate the key points of differentiation for our compounds. We believe that this science-driven approach is critical to achieving optimal therapeutic activity while minimizing unintended side effects of currently available therapies.

Behind our portfolio stands a team with a multi-decade track record of drug approvals and commercial success. This track record has been driven by their extensive experience with empirically-driven clinical trial design and implementation, a history of successful interactions with regulatory agencies and relationships with global key opinion leaders. We believe that the distinctive combination of our management team and our existing pipeline has the potential to bring to patients the next generation of transformative neuroscience therapies.

Our Lead Programs

In addition, we plan to evaluate the potential of this mechanism in other populations, including Alzheimer’s disease psychosis. We initiated a Phase 1 trial evaluating the safety, tolerability and pharmacokinetics, or PK, in elderly healthy volunteers in December 2022 to support the future development of emraclidine in Alzheimer's disease psychosis. In the fourth quarter of 2022, the FDA granted Fast Track Designation for emraclidine for the treatment of hallucinations and delusions associated with Alzheimer's disease psychosis.

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We believe that our lead programs have target product profiles that may enable them to become backbone therapies in their respective lead indications, either replacing standards of care as monotherapies or enhancing treatment regimens as adjunct to existing therapies. Results from the clinical trials mentioned above will guide the potential development of our product candidates in additional indications with similar neurocircuitry deficits.

Our Other Programs

In addition to the lead programs described above, we plan to further characterize and appropriately advance our early clinical and preclinical pipeline across multiple potential neuroscience indications. Our other programs include:

We are also pursuing other undisclosed targets, including those with disease-modifying potential for leading neuroscience diseases. These programs include those initiated by Pfizer as well as others developed internally through the application of human genetic analyses and new technology platforms, such as artificial intelligence and DNA-encoded chemical libraries, to establish novel chemical lead series that are designed to enable better understanding of therapeutic potential.

Our Approach

Below are the key pillars of our targeted approach to neuroscience:

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Our Pipeline

The following table summarizes our current portfolio of programs. This table does not include multiple additional preclinical programs that have not yet been disclosed.

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Our Lead Programs

Emraclidine

We are developing emraclidine for the treatment of schizophrenia. Emraclidine was rationally designed as a PAM that selectively targets the M4 receptor subtype to harness the anti-psychotic benefit believed to be associated with M4 while minimizing the cholinergic side effects typically associated with pan-muscarinic agonists. We believe emraclidine has the potential to mark a significant medical advancement as the muscarinic acetylcholine pathway has long been associated with mediation of neurotransmitter imbalance underlying psychosis. To our knowledge, emraclidine is the only M4-selective PAM currently active in clinical development.

Emraclidine demonstrated robust activity in multiple preclinical psychosis models, including potential benefit in improving cognitive endpoints. Our development plan for emraclidine is informed by thorough in vitro and in vivo PK and PD characterization as well as data from competitive muscarinic compounds. Emraclidine has been evaluated in 33 healthy volunteers and 242 patients in completed trials to date, including 52 schizophrenia patients in Part B of the Phase 1b trial, which showed that it was generally well tolerated with no treatment-related serious adverse events or treatment-related subject discontinuations, and 151 schizophrenia patients in the ambulatory blood pressure monitoring trial, which showed that it was generally well tolerated with a side effect profile consistent with prior trials.

In June 2021, we announced positive topline results for a Phase 1b trial of emraclidine in schizophrenia, consisting of Part A, a MAD assessment, and Part B, a PD assessment. Emraclidine demonstrated a clinically meaningful and statistically significant improvement in the PANSS total score at six weeks and was generally well tolerated compared with placebo at the two dose levels evaluated in Part B. We initiated two Phase 2 clinical trials in schizophrenia in June 2022 and a 52-week open-label extension trial to begin development of the required safety database in September 2022. Data are expected from the Phase 2 trials in the first half of 2024. In parallel, we will be prioritizing nonclinical and clinical safety pharmacology studies, including hepatic and renal insufficiency studies, along with other registration-enabling activities. In December 2022, we announced data from an eight-week ambulatory blood pressure monitoring trial providing clear evidence that emraclidine does not induce an increase in blood pressure with chronic dosing in people living with schizophrenia.

In addition, we plan to evaluate the potential of this mechanism in other populations, including Alzheimer’s disease psychosis. We initiated a Phase 1 trial evaluating the safety, tolerability and PK in elderly healthy volunteers in December 2022 to support the future development of emraclidine in Alzheimer's disease psychosis. In the fourth quarter of 2022, the FDA granted Fast Track Designation for emraclidine for the treatment of hallucinations and delusions associated with Alzheimer's disease psychosis.

Darigabat

We are developing darigabat for the treatment of both epilepsy and panic disorder. Darigabat was rationally designed as an orally bioavailable, twice-daily PAM that selectively targets the alpha-2/3/5 subunits of the GABAA receptor. We believe that by having minimal receptor activation via the alpha-1 subunit-containing GABAA receptor, darigabat can minimize the negative side effects of sedation and potential for loss of efficacy with repeated use, or tolerance, and addiction seen with traditional non-selective GABAA receptor modulators, such as benzodiazepines, or BZDs.

Darigabat has been evaluated in 355 subjects across 11 prior clinical trials. In a Phase 2, double-blind, crossover trial in photoepilepsy patients comparing darigabat to lorazepam, a commonly prescribed BZD, and to placebo, darigabat demonstrated anti-epileptic activity similar to lorazepam. In this trial, six out of seven photosensitive patients taking darigabat achieved complete suppression of epileptiform activity evoked by strobe lights. In a Phase 1 trial comparing darigabat to lorazepam, healthy volunteers were assessed using the NeuroCart CNS test battery to characterize the PD of darigabat. Compared with lorazepam, darigabat demonstrated a greater reduction in saccadic peak velocity, a biomarker indicating engagement of alpha-2/3 subunit-containing GABAA receptors, while having reduced effects on motor coordination (sedation) and cognition. In a Phase 1 MAD trial in healthy volunteers, darigabat showed no dose-related somnolence after the initial titration period, even at dose levels consistent with receptor occupancy of approximately 80%. Taken together, we believe these data suggest that darigabat may have the potential for anti-epileptic activity comparable to currently available BZDs, with reduced sedation, tolerance and withdrawal liabilities that, unlike BZDs, allow it to be dosed chronically.

Based on this extensive clinical data, we initiated REALIZE, a Phase 2 proof-of-concept trial evaluating darigabat as an adjunctive therapy in patients with focal epilepsy, in the second half of 2020. Enrollment in the REALIZE trial has been impacted due to the residual post-COVID environmental and other factors that are resulting in slower-than-expected enrollment in many clinical trials. As a result, we anticipate a delay in the REALIZE readout beyond 2023. Following a detailed review of all environmental factors, we plan to provide updated timing on the REALIZE readout by mid-year. The focal epilepsy population is the largest subpopulation of epilepsy patients and is often studied to establish proof-of-concept and a tolerability profile in focal epilepsy and to support development in additional epilepsy indications.

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In February 2022, we announced positive topline results for a Phase 1 trial of darigabat in a panic symptoms model in healthy volunteers. Both doses of darigabat demonstrated clinically meaningful and statistically significant anxiolytic activity compared with placebo in this proof-of-principle trial. Darigabat was generally well tolerated, with no serious adverse events and no discontinuations in the darigabat cohorts. We intend to initiate a Phase 2 proof-of-concept trial of darigabat in panic disorder in the second quarter of 2023.

Tavapadon

We are developing tavapadon for the treatment of Parkinson’s disease, a neurodegenerative disorder characterized by the death of dopamine-producing neurons in the brain. Tavapadon was rationally designed as an orally bioavailable, once-daily partial agonist that selectively targets dopamine D1/D5 receptor subtypes with the goal of balancing meaningful motor control activity with a favorable tolerability profile. To our knowledge, tavapadon is the only D1/D5 receptor partial agonist currently in clinical development for treatment of motor symptoms of Parkinson’s and the first oral D1/D5 receptor agonist to have achieved sustained motor control improvement in a Phase 2 trial of Parkinson’s.

As part of an extensive clinical program, tavapadon has been evaluated in 294 subjects across 11 prior clinical trials, including five Phase 1 trials in healthy volunteers, three Phase 1/1b trials in patients with Parkinson's and three Phase 2 trials. In a Phase 2 trial in early-stage Parkinson’s, tavapadon demonstrated a statistically significant and clinically meaningful difference from placebo of -4.8 points on the MDS-UPDRS Part III motor score at week 15 of the treatment period. Separation from placebo was observed as early as week three while still in the titration phase. In a Phase 2 trial in late-stage Parkinson’s, tavapadon showed a 1.0-hour improvement versus placebo in “on” time without troublesome dyskinesias at week 10 with a sustained effect observed through week 15, which we and our clinical advisors believe is clinically meaningful. Across the 11 prior clinical trials, tavapadon has consistently demonstrated what we believe to be a favorable tolerability profile as well as a PK profile with a 24-hour terminal half-life, supporting once-daily dosing.

Based on this extensive clinical data, we initiated a registration-directed Phase 3 program for tavapadon beginning in January 2020, which includes two trials as monotherapy in early-stage Parkinson’s, known as TEMPO-1 and TEMPO-2, one trial as adjunctive therapy in late-stage Parkinson’s, known as TEMPO-3, and an open-label extension trial, known as TEMPO-4. Following a detailed review of all environmental factors, data are expected from TEMPO-3 in mid-year 2024 and TEMPO-1 and TEMPO-2 in the second half of 2024.

CVL-871

We are developing CVL-871 for the treatment of dementia-related apathy. Apathy is the leading neuropsychiatric symptom in patients with dementia. It is also one of the strongest predictors of disease progression. While clinicians, patients and caregivers have been challenged by this symptom, there are no currently approved therapies for dementia-related apathy. The FDA has demonstrated interest in development of a therapy for this indication, and in June 2021, we announced that the FDA has granted Fast Track Designation for CVL-871 in dementia-related apathy. CVL-871 is a selective partial agonist of dopamine D1/D5 receptor subtypes specifically designed to achieve a modest level of partial agonism, which we believe may be useful in modulating the complex neural networks that govern cognition, motivation and apathy behaviors in neurodegenerative diseases. Dopamine acting on D1/D5 receptor subtypes in the cortex and midbrain plays a key role in the finely-tuned and dynamic neural network that modulates cognitive function, reward-processing and decision-making. In patients with Parkinson’s disease, we have observed that improving motor symptoms requires higher levels of partial agonism to offset the large losses in dopaminergic neurons in the motor cortex. In contrast, dementia patients require a more finely-tuned modulation of the neural networks that govern cognition, motivation and behavior to normalize the dynamic range of the mesocortical and mesolimbic neurocircuitry. As such, we have designed CVL-871 to have a lower level of partial agonism than tavapadon. The hypothesis for using D1/D5 receptor subtype partial agonism to treat dementia-related apathy is informed by clinical trials of other compounds where increases in dopamine activity resulted in a statistically significant improvement on apathy scales. We believe CVL-871, while potentially avoiding the cardiovascular effects of stimulant medications, may possess an optimal profile to target this new indication due to the degree to which it activates relevant dopamine circuits within the brain.

CVL-871 has been evaluated in two Phase 1 trials in a total of 58 subjects. In these trials, CVL-871 was observed to be generally well tolerated. We also observed evidence of moderate improvement in motor symptoms, a measure of biological activity, along with a PK profile that supports the potential for once-daily dosing. Based on these findings, we are conducting a Phase 2a exploratory trial in dementia-related apathy. Due to slower-than-expected enrollment, data is now expected for this trial in the second half of 2024.

Our Other Programs

In addition to the lead programs described above, we plan to further characterize and appropriately advance our early clinical and preclinical pipeline across multiple potential neuroscience indications. Our other programs include:

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We are also pursuing other undisclosed targets, including those with disease-modifying potential for leading neuroscience diseases. These programs include evaluating those initiated by Pfizer as well as others developed internally through the application of human genetic analyses and new technology platforms, such as artificial intelligence and DNA-encoded chemical libraries to establish novel chemical lead series that is designed to enable better understanding of their therapeutic potential.

Our Strategy

We seek to transform the lives of patients with neuroscience diseases by pursuing a targeted approach to neuroscience and leveraging our deep understanding of neurocircuitry, chemistry and receptor pharmacology. Our strategy is to:

Our Team and Corporate History

Since our founding in 2018, we have assembled a seasoned management team with expertise in neuroscience research, development, regulatory affairs, medical affairs, operations, manufacturing and commercialization. Our team includes industry veterans who have collectively driven over 20 drug approvals, with prior experience at companies such as Biogen, Bristol-Myers Squibb, Merck, NPS Pharmaceuticals, Onyx Pharmaceuticals, Otsuka Pharmaceutical, Vertex Pharmaceuticals and Yumanity Therapeutics. We have an experienced research and development team focused on utilizing our differentiated understanding of the complex neurocircuitry, receptor pharmacology and genetics that underlie neuroscience diseases. This allows us to develop small molecules with target receptor selectivity and indication-appropriate pharmacology, which we believe are key to enhancing activity and improving tolerability in the treatment of these diseases. We believe that the distinctive combination of our management team and our existing pipeline has the potential to bring to patients the next generation of transformative neuroscience therapies.

In August 2018, we entered into a license agreement with Pfizer, or the Pfizer License Agreement, pursuant to which we in-licensed substantially all of our asset portfolio from Pfizer. Under the terms of the Pfizer License Agreement, we are required to pay Pfizer tiered royalties on aggregate net sales of in-licensed products as well as certain regulatory and commercial milestone payments. For additional information regarding the Pfizer License Agreement, see “—Pfizer License Agreement.”

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Cerevel Therapeutics, Inc., or Old Cerevel, was formed as a Delaware corporation in 2018. ARYA Sciences Acquisition Corp II, or ARYA, was incorporated as a blank check company on February 20, 2020 as a Cayman Islands exempted company formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. On June 4, 2020, ARYA consummated its initial public offering. On October 27, 2020, ARYA completed the acquisition of Old Cerevel pursuant to a Business Combination Agreement dated July 29, 2020, as amended on October 2, 2020, or the Business Combination Agreement. Upon closing of the transactions contemplated by the Business Combination Agreement, Old Cerevel became a wholly owned subsidiary of ARYA and ARYA was renamed Cerevel Therapeutics Holdings, Inc. We refer to the transactions contemplated by the Business Combination Agreement in this Annual Report as the Business Combination or the Business Combination Transaction.

Unless the context otherwise requires, references in this Annual Report to “Cerevel”, the “Company”, “us”, “we”, “our” and any related terms prior to the closing of the Business Combination are intended to mean Cerevel Therapeutics, Inc., a Delaware corporation, and its consolidated subsidiaries, and after the closing of the Business Combination, Cerevel Therapeutics Holdings, Inc., a Delaware corporation, and its consolidated subsidiaries.

Our Lead Programs

Emraclidine

We are developing emraclidine for the treatment of schizophrenia. Emraclidine was rationally designed as a PAM that selectively targets the M4 receptor subtype to harness the anti-psychotic benefit believed to be associated with M4 while minimizing the side effects typically associated with pan-muscarinic agonists. We believe emraclidine has the potential to mark a significant medical advance as the muscarinic acetylcholine pathway has long been associated with mediation of neurotransmitter imbalance and psychosis. To our knowledge, emraclidine is the only M4-selective PAM currently active in clinical development.

In June 2021, we announced positive topline results for a Phase 1b trial of emraclidine in schizophrenia, consisting of Part A, a MAD assessment and Part B, a PD assessment. Emraclidine demonstrated a clinically meaningful and statistically significant improvement in the PANSS total score at six weeks and was generally well tolerated compared with placebo at the two dose levels evaluated in Part B. We initiated two Phase 2 clinical trials in schizophrenia in June 2022 and a 52-week open-label extension trial to begin development of the required safety database in September 2022. Data are expected from the Phase 2 trials in the first half of 2024. In parallel, we will be prioritizing nonclinical and clinical safety pharmacology studies, including hepatic and renal insufficiency studies, along with other registration-enabling activities. In December 2022, we announced data from an eight-week ambulatory blood pressure monitoring trial providing clear evidence that emraclidine does not induce an increase in blood pressure with chronic dosing in people living with schizophrenia.

In addition, we plan to evaluate the potential of this mechanism in other populations, including Alzheimer’s disease psychosis. We initiated a Phase 1 trial evaluating the safety, tolerability and PK in elderly healthy volunteers in December 2022 to support the future development of emraclidine in Alzheimer's disease psychosis. In the fourth quarter of 2022, the FDA granted Fast Track Designation for emraclidine for the treatment of hallucinations and delusions associated with Alzheimer's disease psychosis.

Schizophrenia Background

Schizophrenia is a serious, complex and debilitating mental health disorder characterized by a constellation of symptoms, including delusions, hallucinations, disorganized speech or behavior, slowed speech and blunted affect. Schizophrenia is also often associated with significant cognitive impairment, which further limits a patient’s ability to be gainfully employed and maintain relationships. Diagnosis of schizophrenia is usually made in young adulthood and the disease follows a chronic and indolent course characterized by periods of remission and relapse. People with schizophrenia have a 10 to 25-year reduction in life expectancy compared to the general population. An estimated 20 million people worldwide suffer from schizophrenia, including up to 2.1 million people in the U.S.

A disruption in the balance of neurotransmitters, including dopamine, serotonin, glutamate, aspartate, glycine and GABA, is believed to be responsible for the pathogenesis of schizophrenia. Abnormal activity at dopamine receptors, specifically the D2 receptor subtype, in the mesolimbic pathway that results in excess dopaminergic transmission is thought to be associated with many of the psychotic symptoms of schizophrenia. Currently available therapies for schizophrenia are all presumed to work through the antagonism of various dopamine receptors, although the exact mechanisms of action for these agents are unknown. Second-generation atypical antipsychotics, or SGAs, such as risperidone, paliperidone and aripiprazole, are recommended as first-line treatment for schizophrenia. SGAs have a lower risk of extrapyramidal symptoms, including abnormal motor side effects, compared to first-generation antipsychotics, or FGAs, such as chlorpromazine and haloperidol. However, SGAs are more likely to cause weight gain, metabolic syndrome, diabetes and dyslipidemia, leading to long-term cardiovascular morbidity. Both SGAs and FGAs can cause hyperprolactinemia, a hormonal imbalance resulting from D2 receptor blockade, which can lead to enlargement of breast tissue in males and infertility. Approximately 10% of patients are prescribed FGAs as first-line therapy, while 90% of patients start with an SGA.

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Treatment selection is highly individualized and the current approach is largely one of trial and error across sequential medication choices. Using two or even three different antipsychotic agents together is common, though this practice is not encouraged given the potential for an increased risk of drug-drug interactions, side effects, non-adherence and medication errors.

Despite available therapies, only 20% of patients report favorable treatment outcomes. Medication adherence is poor in patients with schizophrenia, with a compliance rate of about 60% and a discontinuation rate of 74% within 18 months. Patients who discontinue their medication suffer from high relapse rates of 77% at one year and 90% at two years. The further progression of disease is driven by the cycle of repetitive relapse over time. Each relapse in schizophrenia marks a progression in disability, leading physicians to prioritize efficacy in selecting first-line therapy. No new therapies with novel mechanisms of action have been approved for the treatment of schizophrenia in over 20 years. There remains a significant unmet need for more effective therapies with better tolerability profiles in the treatment of schizophrenia.

Muscarinic Receptors in Schizophrenia

One of the leading theories on the etiology of schizophrenia is that an overactivity of dopamine in certain brain regions is closely associated with the prevailing psychotic symptoms. Current antipsychotics target a direct blockade of dopamine receptors. While this approach is effective at reducing symptoms, it also leads to significant side effects.

Presynaptic expression of the M4 receptor subtypes balances acetylcholine and dopamine in the striatum, which is the region of the brain primarily responsible for psychotic symptoms. The imbalance of acetylcholine and dopamine is hypothesized to contribute to psychosis in schizophrenia. Unlike other muscarinic receptors, M4 receptor subtypes are differentially expressed in the striatum. Activation of muscarinic receptors prevents acetylcholine release, which has been shown to indirectly modulate levels of dopamine without the direct D2/D3 receptor blockade that has been theorized to cause some of the unwanted motor symptoms of current antipsychotics. Thus, selective activation of M4 has the potential to treat the neurobehavioral components such as psychosis, agitation and cognitive deficits that are associated with schizophrenia and other neurodegenerative diseases like Alzheimer’s and Parkinson’s, while potentially mitigating some of the side effects of current antipsychotics. This mechanism of action is illustrated below:

Clinical trials of xanomeline, a full muscarinic agonist that preferentially activates the M4 and M1 subtypes, demonstrated that activation of muscarinic receptors led to dose-dependent improvements in a number of psychiatric symptoms, including psychosis, cognition, agitation and aggression in both schizophrenia and Alzheimer’s patients. Despite these compelling results, further clinical development of xanomeline as a monotherapy was halted due to severe gastrointestinal side effects, including a greater than 50% discontinuation rate, which were likely mediated by non-selective muscarinic receptor activation. Furthermore, recent studies in knockout mice with the M4 receptor subtype eliminated suggest that the antipsychotic activity attributed to xanomeline is likely driven primarily by M4 and that a more selective muscarinic activator could potentially convey similar clinical benefits while minimizing gastrointestinal side effects.

Alzheimer's Disease Psychosis Background

Dementia is a progressive disorder, characterized by a decline in cognitive functioning across multiple domains, that can significantly affect social and/or occupational function. The most common type of dementia is Alzheimer’s disease, which had an estimated prevalence of 6.2 million in the U.S. in 2021. Psychosis, a syndrome characterized primarily by symptoms of hallucinations

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and delusions, is common in dementia, with an overall prevalence of 41% in patients with Alzheimer’s disease. Patients experiencing psychotic symptoms have more rapid cognitive and functional decline, increased co-morbidity with other neuropsychiatric symptoms (including depression and agitation) and have higher rates of nursing home admissions/institutionalization and greater treatment-related mortality. Therefore, management of psychotic symptoms is an important component in caring for patients with Alzheimer’s disease.

Currently, there are no approved therapies for the treatment of Alzheimer’s disease psychosis. Current pharmacological treatment for Alzheimer’s disease psychosis largely consists of off-label use of typical and atypical antipsychotic medications, primarily based on their use to treat psychosis and agitation in patients with other psychiatric disorders. Although these treatments are moderately effective, they are associated with adverse effects, many that are especially worrisome in elderly patients (e.g., excessive sedation, orthostatic hypotension/falls, extrapyramidal symptoms and anticholinergic side effects) and increased mortality. Due to this increased risk, FDA, in 2005, initiated a requirement for Black Box warnings on all atypical antipsychotic drug labels noting an increased risk of mortality in elderly patients with dementia-related behavioral disorders. There is a clear unmet need for new treatments with acceptable safety profiles for management of Alzheimer’s disease psychosis.

Our Solution—Emraclidine

Emraclidine is a PAM that selectively targets the M4 receptor subtype. We are developing emraclidine for the treatment of schizophrenia and Alzheimer's disease psychosis. Key differentiating features of emraclidine include:

We believe emraclidine has the potential to be a new generation antipsychotic that could become the treatment of choice for schizophrenia, if approved. Each relapse in schizophrenia marks a progression in disability, leading physicians to prioritize efficacy in selecting first-line therapy. With the potential for antipsychotic activity that we believe may exceed existing atypical antipsychotics, emraclidine could become an attractive option in newly diagnosed patients. Additionally, given its potentially improved tolerability profile relative to atypical antipsychotics, emraclidine could displace existing options for patients where there is evidence of treatment-related side effects. We also plan to evaluate the potential for this mechanism in other populations, including Alzheimer's disease psychosis. We initiated a Phase 1 trial evaluating the safety, tolerability and pharmacokinetics in elderly healthy volunteers in December 2022 to support the future development of emraclidine in Alzheimer's disease psychosis. In the fourth quarter of 2022, the FDA granted Fast Track Designation for emraclidine for the treatment of hallucinations and delusions associated with Alzheimer's disease psychosis.

Clinical Trials

Emraclidine has been evaluated in 33 healthy volunteers and 242 patients in completed trials to date, including 52 schizophrenia patients in Part B of the Phase 1b trial and 151 schizophrenia patients in the ambulatory blood pressure monitoring trial. Emraclidine was generally well tolerated, with no treatment-related serious adverse events, or SAEs, or treatment-related subject discontinuations. In December 2022, we announced data from an eight-week ambulatory blood pressure monitoring trial providing clear evidence that emraclidine does not induce an increase in blood pressure with chronic dosing in people living with schizophrenia. In the Phase 1b trial, the incidence of nausea and other gastrointestinal adverse events, or AEs, was low and similar across all treatment groups. Emraclidine was not associated with a greater incidence of weight gain than placebo and no adverse events related to extrapyramidal symptoms were reported.

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Emraclidine demonstrated clinically meaningful and statistically significant improvements in the PANSS total score compared with placebo at the two dose levels evaluated in Part B of the Phase 1b trial. The emraclidine 30 mg once-daily dose resulted in a statistically significant and clinically meaningful mean reduction from baseline of 19.5 points in the PANSS total score and a mean reduction of 12.7 points in PANSS versus the placebo group (p=0.023). The emraclidine 20 mg twice-daily dose resulted in a statistically significant and clinically meaningful mean reduction from baseline of 17.9 points in PANSS total score and a mean reduction of 11.1 points in PANSS total score compared with the placebo group (p=0.047). These results were further supported by clinically meaningful reductions in the PANSS Positive, PANSS Negative, and PANSS General Psychopathology subscales. Emraclidine has also been tested in several preclinical models that have been used to characterize known antipsychotic medications. The overall results from our preclinical studies showed the potential of emraclidine to reduce dopaminergic hyperactivation without resulting in catalepsy, or muscular rigidity.

Phase 1b Placebo-controlled Multiple Dose Trial in Schizophrenia

In June 2021, we completed Trial NCT04136873, a two-part randomized, placebo-controlled Phase 1b trial to evaluate the safety, tolerability, PK and preliminary PD of repeated daily doses of emraclidine in patients with schizophrenia. In the Part A MAD phase of the trial, doses of 5 mg to 40 mg (administered as 20 mg BID) were explored with up to 21 days of administration at target dosage. The Part A MAD safety and tolerability data were supportive of proceeding to six weeks of dosing in the subsequent Part B portion of the trial. The primary objective of Part B was to further characterize the safety and tolerability of target doses selected from the MAD investigation of emraclidine in Part A in participants with acute schizophrenia; the PK of emraclidine was assessed as a secondary endpoint. In addition, we conducted an exploratory PD assessment that included the PANSS total score and the associated positive, negative, and general psychopathology subscales. The PANSS total score ranges from 30 to 210 points and is based on the sum of 30 items rated from 1 to 7, with higher scores indicating more severe symptoms.

In Part B, adult patients with a primary diagnosis of schizophrenia who were 55 years and younger were eligible for the trial. Inclusion criteria included a CGI-S score of at least 4 (moderately to severely ill) and a PANSS total score of at least 80 at screening, a history of relapse and/or symptom exacerbation when not receiving antipsychotic medication, and current acute exacerbation of psychosis with onset within two months. Key exclusion criteria included patients with schizophrenia who were considered resistant or refractory to antipsychotic treatment. All patients were washed out of their current antipsychotic medications prior to participating in the trial.

A total of 81 patients were randomized in a 1:1:1 ratio to emraclidine at a dose of 20 mg BID, 30 mg QD, or placebo for a total of six weeks. Six patients discontinued from the trial in each treatment group and a total of 63 patients completed the trial. The majority of participants were male (78%) and black (69%) and the mean age was 40 years. The mean baseline PANSS total score was 95; baseline demographic and disease characteristics were distributed evenly across treatment groups.

Safety and Tolerability Data

In general, the tolerability profile of emraclidine was favorable, with comparable incidence of AEs compared with placebo, no SAEs associated with treatment, and no evidence of extrapyramidal symptoms, metabolic effects, gastrointestinal effects or weight gain compared with placebo. SAEs included one instance each of COVID-19 (emraclidine 20 mg BID), accidental cocaine overdose (emraclidine 30 mg QD) and exacerbation of schizophrenia (emraclidine 30 mg QD); none of the SAEs were considered related to the study drug. The table below summarizes the most common adverse events.

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Summary of Adverse Events

Modest, asymptomatic increases from baseline relative to placebo were observed in mean supine systolic and diastolic blood pressure and heart rate in both emraclidine groups with initiation of treatment. Mean blood pressure and heart rate measures trended downward for both emraclidine groups over the treatment period, such that by week six, there was no clinically meaningful increase in mean blood pressure and heart rate compared with placebo. These increases may be mediated by emraclidine's activity on the M4 receptor subtype, either peripherally or centrally; increased heart rate has been observed in some other antipsychotic drugs due to their anticholinergic properties. The chart below summarizes the change from baseline on systolic and diastolic blood pressure as well as heart rate for each treatment group at week six.

Pharmacodynamics

Both doses of emraclidine demonstrated clinically meaningful and statistically significant antipsychotic effects, with no meaningful differences in gastrointestinal side effects, extrapyramidal symptoms or weight gain compared with placebo. The 30 mg once-daily group demonstrated an improvement of 19.5 while the 20 mg twice-daily cohort showed an improvement of 17.9 from baseline on the PANSS total score after six weeks of treatment. Both treatment groups had statistically significant reductions relative to placebo of 12.7 and 11.1 respectively, with p-values less than 0.05. These results were further supported by statistically significant and clinically meaningful improvements in the PANSS-negative subscale for both doses – the 30 mg once-daily group resulted in a point improvement of 3.1 over placebo with a p-value of 0.009 and the 20 mg twice-daily group showed a 3.7 improvement over placebo with a p-value of 0.002. We also observed clinically meaningful improvements on the PANSS positive subscale for both

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doses, with the 30 mg once-daily group demonstrating a statistically significant reduction of 4.3 points versus placebo. The table and chart below summarize the change in PANSS total score from baseline over the treatment period.

Phase 1 Ambulatory Blood Pressure Monitoring Trial

In December 2022, we announced data from Trial NCT05245539, a Phase 1 randomized, double-blind trial studying the effect of emraclidine on 24-hour ambulatory blood pressure over an eight-week period in people living with schizophrenia. The objective of the trial was to accurately characterize any potential blood pressure effect for both doses of emraclidine studied (10 and 30 mg QD). This trial was designed in line with FDA guidance (Assessment of Pressor Effects of Drugs, Guidance for Industry) to provide an accurate characterization of any potential sustained pressor effects of emraclidine over 24 hours of ambulatory monitoring in adults between the ages of 30 and 60 years old living with schizophrenia. Trial participants were evaluated at two doses, 10 mg QD and 30 mg QD, and the change from baseline to week eight, the primary endpoint, was assessed independently for each dose.

Data from this trial provided clear evidence that emraclidine does not induce an increase in blood pressure with chronic dosing in people living with schizophrenia. On the primary endpoint, emraclidine demonstrated a mean change from baseline at week eight in 24-hour ambulatory systolic blood pressure of -2.7 mmHg for the 10 mg QD group and -0.4 mmHg for the 30 mg QD group. The upper bound of the two-sided 95% confidence interval for the change from baseline at week eight was -0.3 mmHg for the 10 mg QD

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group and 2.1 mmHg for the 30 mg QD group. As a result, the trial ruled out an increase in blood pressure for both doses (defined per FDA guidance as >3 mmHg change from baseline). The secondary endpoints of the trial demonstrated findings consistent with the primary endpoint, corroborating the overall trial results. Emraclidine was generally well tolerated in this trial, with a side effect profile consistent with prior trials.

Preclinical Studies

Emraclidine was tested in several preclinical models that have been used to characterize known antipsychotic medications. The overall results from our preclinical studies showed the potential of emraclidine to reduce dopaminergic hyperactivation without resulting in catalepsy. In a mouse study, emraclidine significantly decreased both spontaneous and amphetamine-induced hyperlocomotion activity to levels similar to haloperidol, which is considered one of the most potent antipsychotics. Furthermore, in a rat pre-pulse inhibition model, an electrical deficit model translatable to patients with schizophrenia, emraclidine demonstrated a dose-dependent improvement in amphetamine-induced deficits. In order to further explore the potential to affect other symptoms of schizophrenia, like cognitive impairment, emraclidine was evaluated in a study in rats that measured various aspects of memory function. The results showed improvement in both episodic and working memory, suggesting a potential opportunity for emraclidine to be differentiated compared to existing medications for schizophrenia.

Incorporation by Reference

For more information about additional prior clinical trials of emraclidine, please see pages 10 to 11 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, which are incorporated herein by reference.

Ongoing Clinical Trials

Based on the results of the Phase 1b trial in schizophrenia, we initiated two double-blind, placebo-controlled three-arm Phase 2 clinical trials of emraclidine in schizophrenia in June 2022 and a 52-week open-label extension trial to begin development of the required safety database in September 2022. These trials are designed to enable the full exploration of the therapeutic dose range of emraclidine. Data are expected from the Phase 2 trials in the first half of 2024.

Each trial is designed to enroll approximately 372 schizophrenia patients with acute exacerbation or relapse of psychotic symptoms. Patients will include men and women between the ages of 18 and 65 and inclusion criteria include PANSS total scores between 85 and 120 and CGI-S scores of at least 4 at baseline. In each trial, patients will be randomized 1:1:1 into one of two emraclidine dose arms or placebo. The trial includes a screening period of up to 15 days and six weeks of in-patient treatment. The first trial is evaluating emraclidine 10 mg once daily, emraclidine 30 mg once daily and placebo. The second trial is evaluating emraclidine 15 mg once daily, emraclidine 30 mg once daily and placebo. All emraclidine doses will be administered once daily without titration. The two trials have identical designs with the exception of the emraclidine doses.

The primary endpoint for the trials will be change in the PANSS total score at week six. The key secondary endpoint will be change in the CGI-S. Additional endpoints will include the PANSS positive and PANSS negative subscale scores, the Marder Factor scores and the PANSS responder rate, defined as the percentage of patients with at least 30% reduction from baseline in the PANSS total score. Other measures will include the Short-Form Six-Dimension, or SF-6D, which is a quality-of-life measure, and the Brief Assessment of Cognition in Schizophrenia, or the BACS.

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The diagrams below summarize the design of the two trials:

In parallel, we will be prioritizing nonclinical and clinical safety pharmacology studies, including hepatic and renal insufficiency studies, along with other registration-enabling activities.

Darigabat

We are developing darigabat for the treatment of both epilepsy and panic disorder. Darigabat was rationally designed as an orally bioavailable, twice-daily PAM that selectively targets the alpha-2/3/5 subunits of the GABAA receptor. We believe that by having minimal activity via the alpha-1 subunit-containing GABAA receptor, darigabat can minimize the negative side effects of sedation and potential for tolerance and addiction seen with traditional non-selective GABAA receptor modulators, such as BZDs. Based on extensive clinical and preclinical data generated to date, including positive data from a Phase 2 proof-of-principle photoepilepsy trial, we initiated REALIZE, a Phase 2 proof-of-concept trial in patients with focal epilepsy, in the second half of 2020. Enrollment in the REALIZE trial has been impacted due to the residual post-COVID environmental and other factors that are resulting in slower-than-expected enrollment in many clinical trials. As a result, we anticipate a delay in the REALIZE readout beyond 2023. Following a detailed review of all environmental factors, we plan to provide updated timing on the REALIZE readout by mid-year. The focal epilepsy population is the largest subpopulation of epilepsy patients and is often studied to establish proof-of-concept and a tolerability profile in focal epilepsy and to support development in additional epilepsy indications.

In February 2022, we announced positive topline results for a Phase 1 trial of darigabat in a panic symptoms model in healthy volunteers. Both doses of darigabat demonstrated clinically meaningful and statistically significant anxiolytic activity compared with placebo in this proof-of-principle trial. Darigabat was generally well tolerated in this trial, with no serious adverse events and no discontinuations in the darigabat cohorts. We intend to initiate a Phase 2 proof-of-concept trial of darigabat in panic disorder in the second quarter of 2023.

Epilepsy Background

Epilepsy is a chronic disorder of the CNS that is characterized by recurrent, unprovoked seizures arising from abnormal electrical discharges in the brain. This may result in alterations of consciousness, involuntary movement or altered sensations. Epilepsy may be related to a brain injury or heredity, but often the cause is unknown. A person is diagnosed as having epilepsy when they have had at least two unprovoked seizures. Epileptic seizures are categorized in two major groups: generalized onset seizures and focal onset seizures. Generalized onset seizures begin with a widespread electrical discharge that involves both sides of the brain at once. Focal onset seizures begin with an electrical discharge in one limited area of the brain.

According to the National Institute of Neurological Disorders and Stroke and the Epilepsy Foundation, approximately 65 million people suffer from epilepsy worldwide. An estimated 57% of all patients with epilepsy experience focal onset seizures while the remaining patients are classified as either having generalized onset seizures (32%) or unknown onset seizures (11%).

The current standard of care for epilepsy is treatment with one or more anti-seizure medications, or ASMs, which act through diverse mechanisms of action to reduce abnormal electrical activity in the brain. Example mechanisms include voltage-gated ion channel inhibitors, presynaptic proteins and neurotransmitter receptors such as GABAA receptors. Some ASMs have multiple

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mechanisms and some have only one known mechanism, but many ASMs have dose-limiting side effects and tolerability issues and some patients on ASMs may continue to experience ongoing seizures despite treatment.

Treatment initiation typically starts with a single ASM, with dose escalation until seizure control is achieved or AEs become intolerable. Levetiracetam (Keppra), carbamazepine or lamotrigine are often used as a first-line therapy among newly diagnosed patients. Patients who do not respond to monotherapy are started on adjuvant therapy with a preference for a drug with a different mechanism of action. Adding on or switching to new therapies is driven by breakthrough seizures, which indicate suboptimal efficacy, and tolerability issues. Shortcomings of available therapies include adverse effects such as sedation, ataxia (the presence of abnormal, uncoordinated movements), cognitive impairment, agitation, weight gain and tolerance.

Despite the existence of over 30 approved ASMs, approximately 30% of epilepsy patients fail to achieve seizure control even with the use of two or more ASMs (whether as monotherapy or in combination), which the International League Against Epilepsy defines as being drug resistant. Inability to control seizures may result in severe disability, inability to retain employment and increased rates of mortality. Sudden unexpected death in epilepsy, or SUDEP, is the leading cause of death in patients with uncontrolled epilepsy.

BZDs have been important agents in the management of epilepsy for over 50 years. Of currently available therapies, BZDs are highly efficacious ASMs and may be administered via multiple routes. However, their use is primarily limited to acute or rescue treatment because they are associated with the development of tolerance resulting from repeated use, side effects such as cognitive impairment and sedation, as well as the development of physical and psychological dependence. BZDs commonly used for the acute management of seizures include clonazepam, clorazepate, diazepam, lorazepam, midazolam and clobazam. More than 10 BZDs are available and may be prescribed for treatment of seizures. Clobazam and clonazepam are BZDs approved for chronic adjunctive treatment of seizures associated with Lennox-Gastaut Syndrome, a rare childhood form of epilepsy. Given their drawbacks, including debilitating side effects, risk of withdrawal and development of tolerance, BZDs are not typically prescribed for chronic treatment of focal epilepsy or generalized epilepsy.

GABA is the main inhibitory neurotransmitter that dampens down neuronal hyperexcitation through hyperpolarization. GABAA receptors are comprised of five subunits and are classified into three major groups (alpha, beta and gamma) and several minor groups. BZDs are non-selective PAMs of the GABAA receptor, enhancing the effect of GABAA receptors containing alpha-1/2/3/5 subunits. Alpha-1 subunit-containing GABAA receptors are broadly expressed throughout the brain and their modulation is believed to underlie many tolerability issues associated with BZD use (including sedation, motor and cognitive impairment) and contribute to desensitization and tolerance. In preclinical studies, the sedative effects of BZDs have been attributed to alpha-1 containing receptors. The role of alpha-1 in sedation is further supported by the clinical use of alpha-1 selective non-BZD Z-drugs such as zolpidem, which are used to treat insomnia. Meanwhile, alpha-2/3/5 containing GABAA receptors are expressed in more discrete brain regions, primarily within the cortical and thalamic neural networks. In preclinical studies, the anticonvulsant effects of BZDs have been attributed to alpha-1/2, the anxiolytic effects to alpha-2/3, analgesic activity to alpha-2/3/5 and some of the effects on memory function to alpha-5. As such, we believe selectively targeting the alpha-2/3/5 subunits present an attractive treatment option for epilepsy.

Panic Disorder Background

Anxiety disorders are the most common form of mental illness in the United States, affecting over 45 million adults or 15% of the U.S. population. Globally, over 370 million people are impacted by an anxiety disorder of some kind. The most common types of anxiety disorders include panic disorder, generalized anxiety disorder and social anxiety. The social impact of anxiety disorders includes increased risk of suicide, reduced achievement in work and school, increased risk of absenteeism, co-morbid depression, potential for substance abuse and higher healthcare costs.

In particular, panic disorder is a serious condition that can cause significant psychological and physical distress. Panic disorder manifests as recurrent, unexpected panic attacks, and a persistent fear of future panic attacks and their consequences with subsequent maladaptive behavioral changes. According to the DSM-5-TR, the average 12-month prevalence of panic disorder is 2% to 3% in the U.S. and EU across adults and adolescents. Another U.S. focused survey of 9,282 adults reported a lifetime panic disorder prevalence of 4.7% according to the DSM-IV diagnostic criteria, with a prevalence rate of 3.7% for panic disorder without agoraphobia and 1.1% for panic disorder with agoraphobia.

Despite the availability of therapies, approximately 56% of patients with panic disorder are not receiving therapy. For those on treatment, a significant proportion of patients with panic disorder have an incomplete or partial response to available treatments with a low likelihood of complete and persistent remission. The various undesirable side effect profiles of available therapies contribute to suboptimal adherence and early discontinuation of therapy, which increases the probability of relapse. In addition, there have been limited new treatment options with no recent drug approvals for the treatment of panic disorder in the U.S. since venlafaxine was approved in 2005. Taken together, there is a clear unmet need for new treatments for panic disorder that can deliver symptomatic relief while maintaining a favorable tolerability profile.

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We believe that by selectively targeting the alpha-2/3/5 subunits of the GABAA receptor and sparing the alpha-1 subunit, darigabat has the potential to provide BZD-like anxiolytic activity with an improved tolerability profile that could enable patients to move from the current standard of episodic dosing to a daily maintenance treatment regimen. In particular, we believe darigabat has the potential to minimize or avoid tolerability issues seen with BZDs that mostly limit them to acute, episodic use, such as sedation, risk of abuse, withdrawal and development of tolerance.

Our Solution—Darigabat

Darigabat is a selective PAM that targets GABAA receptors containing alpha-2/3/5 receptor subunits. We are developing darigabat for the treatment of epilepsy and panic disorder. Key differentiating features of darigabat include:

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Based on these differentiating features, we believe darigabat has the potential for anti-epileptic and anxiolytic activity comparable to currently available BZDs but with reduced tolerance, sedation and withdrawal liabilities, which may enable chronic use.

For newly-diagnosed patients, we believe darigabat has the potential to become first-line therapy given the limitations of existing treatments in balancing anti-epileptic activity with acceptable tolerability. For patients on polypharmacy experiencing tolerability issues, darigabat’s novel mechanism of action and expected tolerability profile has the potential to enable physicians to replace (after a cross-taper) a higher-risk drug in a patient’s regimen. Additionally, for patients on multiple medications who experience breakthrough seizures, the target receptor selectivity and potential improved tolerability profile suggest that darigabat could be added to their current regimen for seizure control.

In panic disorder, we believe darigabat has the potential to provide anxiolytic benefit while minimizing the limiting tolerability effects of non-selective GABAA PAMs such as BZDs, with the possibility of shifting the treatment paradigm from episodic use of BZDs in response to anxiety attacks to a well tolerated, daily maintenance regimen.

Pending the results of our ongoing and planned trials, we believe darigabat could potentially change the paradigm of care for epilepsy and panic disorder, moving GABAA receptor modulators earlier in the treatment paradigm and from acute therapy to chronic therapy.

Clinical Trials

Darigabat has been evaluated in 355 subjects across 11 prior clinical trials in both patients and healthy volunteers. In a Phase 2, double-blind, crossover trial in photoepilepsy patients comparing darigabat to the commonly prescribed BZD lorazepam and to placebo, darigabat demonstrated anti-epileptic activity similar to lorazepam. In this trial, six out of seven patients taking darigabat achieved complete suppression of epileptiform activity evoked by flashing lights. In a Phase 1 trial comparing darigabat to lorazepam, healthy volunteers were assessed using the NeuroCart CNS test battery. Compared to lorazepam, darigabat demonstrated a greater reduction in saccadic peak velocity, a biomarker indicating engagement of selective alpha-2/3 subunit-containing GABAA receptors, while having reduced effects on motor coordination and cognition. Furthermore, in a Phase 1 MAD trial, darigabat showed no dose-related somnolence, even at dose levels consistent with receptor occupancy of approximately 80%. In addition, across several multiple-dose trials, darigabat has shown no evidence of withdrawal effects, a common problem with BZDs. Along with PK, PD and safety margin analyses, dose selection for trials with darigabat was informed by a Phase 1 PET receptor occupancy trial in healthy volunteers. Taken together, we believe these data suggest that darigabat may have the potential for anti-epileptic activity comparable to currently available BZDs, with reduced sedation, tolerance and withdrawal liabilities. We initiated a Phase 2 proof-of-concept trial in patients with focal epilepsy in the second half of 2020. Enrollment in the REALIZE trial has been impacted due to the residual post-COVID environmental and other factors that are resulting in slower-than-expected enrollment in many clinical trials. As a result, we anticipate a delay in the REALIZE readout beyond 2023. Following a detailed review of all environmental factors, we plan to provide updated timing on the REALIZE readout by mid-year. In February 2022, we announced positive topline results for a Phase 1 trial of darigabat in a panic symptoms model in healthy volunteers. Both doses of darigabat demonstrated clinically meaningful and statistically significant anxiolytic activity compared with placebo in this proof-of-principle trial. Darigabat was generally well tolerated in this trial, with no serious adverse events and no discontinuations in the darigabat cohorts. We intend to initiate a Phase 2 proof-of-concept trial of darigabat in panic disorder in the second quarter of 2023.

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The table below provides an overview of all clinical trials of darigabat completed to date, including trials in indications other than epilepsy.

Selected Darigabat Clinical Trials

Phase 1 Trial in Panic Symptoms Model

In February 2022, we announced positive topline results for Trial NCT04592536, a Phase 1 trial of darigabat in a panic symptoms model in healthy volunteers. The Phase 1 proof-of-principle trial was a three-cohort, randomized, double-blind, placebo- and active-controlled, crossover trial in healthy volunteers. The primary objective of the trial was to evaluate the anxiolytic effects of multiple doses of darigabat using an experimental medicine model of carbon dioxide (CO2) inhalation that is associated with symptoms of anxiety/panic in healthy volunteers. This model is known to be sensitive to the effects of drugs approved for the treatment of anxiety, including benzodiazepines and SSRIs.

This trial was designed with a maximum duration of approximately 13 weeks and consisted of a screening/baseline period, a treatment period and a follow-up period. During the screening/baseline period, subjects were exposed to the CO2 challenge, and only subjects who were sensitive to the anxiogenic effects of 35% CO2 double-breath inhalation at screening were eligible for randomization during the treatment period. Each treatment period consisted of eight days of dosing followed by the CO2 challenge performed after dosing on day eight. Adverse events were reported via participant queries approximately four times daily. The trial was conducted as a two-period, two-sequence crossover design comparing multiple doses of high-dose darigabat (25 mg BID), low-dose darigabat (7.5 mg BID), and alprazolam (1 mg BID) against placebo. Three cohorts of 18 subjects, for a total of 54 subjects, completed the trial. The primary endpoint of the trial was the change in the Panic Symptoms List, or PSL-IV, total score, which includes 13 symptoms scored across a range of 0 (absent) to 4 (very intense) and is commonly used to assess panic/anxiety. The design of this trial is illustrated below:

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Pharmacodynamic Results

After eight days of treatment, the darigabat 7.5 mg and 25 mg twice-daily doses demonstrated a 3.9 point (p=0.036) and 4.5 point (p=0.008) placebo-adjusted improvement, respectively, on the primary endpoint of the Panic Symptoms List (PSL-IV) total score. The alprazolam 1 mg twice-daily dose demonstrated a 1.6 point (p=0.286) placebo-adjusted improvement on the PSL-IV total score. These results are illustrated below:

These positive results were further supported by the secondary endpoint, change in the Fear Visual Analog Scale, or VAS Fear score, which demonstrated a 12.8 point (p=0.026), 7.8 point (p=0.282), and 0.9 point (p=0.876) placebo-adjusted improvement for the darigabat 7.5 mg, 25 mg, and alprazolam 1 mg twice-daily doses, respectively. These results are illustrated below:

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Darigabat was generally well tolerated in this trial, with no SAEs and no treatment-related discontinuations in the darigabat cohorts. Ninety-seven percent of AEs reported in the two darigabat treatment cohorts were considered mild. The remainder were considered moderate and there were no severe AEs in the darigabat treatment arms.

The most common AEs included bradyphrenia, dizziness, somnolence, fatigue and disturbance in attention, and the AEs observed were consistent with previous trials of darigabat in healthy volunteers. The AEs with an incidence greater than or equal to 10% in any active arm which were observed more frequently than placebo are summarized below.

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This trial demonstrated the anxiolytic potential of darigabat based on reduction of acute anxiety/panic evoked by CO2 inhalation in healthy subjects. We intend to initiate a Phase 2 proof-of-concept trial of darigabat in panic disorder in the second quarter of 2023.

Phase 2 Trial in Photoepilepsy

In February 2017, Pfizer completed Trial B7431005, a randomized, placebo- and active-controlled, cross-over, proof-of-principle, Phase 2 trial designed to evaluate the efficacy of darigabat in photoepilepsy using lorazepam as an active control.

Pharmacological effects in photoepilepsy proof-of-principle trials are correlated with a higher likelihood that positive results will be observed in the clinical epilepsy population. As such, it has historically been utilized as a tool to quantitatively predict efficacy in epilepsy. Doses corresponding to a 50% to 100% response in these proof-of-principle trials for a range of well-precedented and clinically characterized anticonvulsive agents were found to be within two-fold of the minimally efficacious doses used in focal or generalized epilepsy. These data provide support for the translatability of the photoepilepsy model to other epilepsy states.

A total of seven patients with documented photoepilepsy were randomized to the four-period crossover trial examining single doses of 17.5 mg and 52.5 mg of darigabat, 2 mg of lorazepam as an active control and placebo, with each patient receiving all treatments in a random order with a one-to-three week washout between treatments. The 52.5 mg dose of darigabat was selected for the trial based on the expectation that it would achieve maximal PD effect in the alpha-2/3 saccadic peak velocity biomarker assessment and maximal receptor occupancy of approximately 80%. The lower 17.5 mg dose of darigabat was expected to achieve approximately 60% receptor occupancy.

Patients were exposed to intermittent bursts of light with different flash frequencies (intermittent photic stimulation) to establish the standardized photosensitivity range, or SPR, at which electroencephalographic, or EEG epileptiform activity (photoparoxysmal response, or PPR) was observed. Flashes were administered at standard frequencies, with the SPR being the range of frequencies over which EEG epileptiform activity occurred. The maximum SPR was 14 with a minimum of 0, where an SPR of 0 indicates complete suppression of EEG epileptiform activity.

The primary endpoint was the average change in SPR over the first six hours post-treatment. As measured by SPR, the mean response of 17.5 mg and 52.5 mg of darigabat compared to placebo in the most sensitive eye condition was -6.2 and -5.4, respectively. The mean response of 2 mg of lorazepam compared to placebo was -5.2. Mean responses for 17.5 mg and 52.5 mg of darigabat and 2 mg of lorazepam were considered similar to each other and statistically significant relative to placebo at the prespecified one-sided 5% level. Results are summarized in the table and chart below.

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Standardized Photosensitive Range

Darigabat vs. Lorazepam vs. Placebo

The proportion of participants with complete suppression, partial response and no response to intermittent photic stimulation is summarized in the table below. Six out of seven patients had complete suppression of EEG epileptiform activity following receipt of 17.5 mg of darigabat, 52.5 mg of darigabat or 2 mg of lorazepam, whereas two out of seven patients had complete suppression following receipt of placebo. Based on these results, along with PK data and PET receptor occupancy-based modeling, we believe that both doses of darigabat in this trial are within the anticipated therapeutic range for anti-seizure effect.

Summary of Proportion of Participants with Categorical Responses in the Most Sensitive Eye Condition

Consistent with previous trials in healthy volunteers and patients, darigabat was observed to be generally well tolerated. The most frequently reported AEs in this single-dose trial were somnolence (three subjects each on placebo, 17.5 mg of darigabat and 2 mg of lorazepam and four subjects on 52.5 mg of darigabat) and dizziness (three subjects each on 17.5 mg and 52.5 mg of darigabat and one subject on 2 mg of lorazepam). One of the dizziness AEs and two of the somnolence AEs were moderate in severity. All other somnolence and dizziness AEs were mild in severity. There were no SAEs and no discontinuations due to AEs in this trial. Based on the totality of clinical data for darigabat to date, including the Phase 1 MAD trial in healthy volunteers described below, we believe that titration can help mitigate effects on somnolence and dizziness.

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In summary, in this trial, darigabat demonstrated pronounced anticonvulsant activity on par with lorazepam, in patients with photoepilepsy, a clinical epilepsy model translationally relevant to other epilepsy populations.

Phase 1 Single Ascending Dose Trial with Pharmacodynamic Assessments

In July 2014, Pfizer completed Trial B7431001, a first-in-human Phase 1 trial designed to characterize the safety, tolerability, PK and PD of single doses of darigabat in healthy adult volunteers between 18 and 55 years old.

The primary objectives of this trial were to evaluate the safety and tolerability of escalating single oral doses of darigabat, as well as the PK and PD of single doses of darigabat alone and in combination with lorazepam in healthy volunteers. PD effects were assessed using NeuroCart, a test battery which assesses a range of CNS functions, both objective, such as neurophysiologic and cognition, and subjective, such as memory and mood. NeuroCart can be used to correlate a compound’s PD activity and PK and provide evidence to test hypotheses regarding mechanism of action. NeuroCart PD measurements rationally selected for this trial were based on known GABAA receptor pharmacology and included:

The trial was conducted in two parts. The first part of the trial (Cohorts 1, 2 and 3) was a double-blind, randomized, placebo-controlled, crossover, SAD trial to evaluate the safety, tolerability, PK and PD of single escalating doses of darigabat. Eight subjects in each cohort received darigabat and the remaining two subjects received placebo. Cohorts 1 and 2 were dosed with the first 10 dose levels of darigabat (0.04 mg to 15 mg). Cohort 3 evaluated doses from 25 mg to 100 mg.

The second part of the trial (Cohort 4) was conducted to further explore and compare NeuroCart PD effects of darigabat alone, 2 mg of lorazepam alone and the combination of darigabat with 2 mg of lorazepam. This was done to explore the PD interaction between the two drugs. Part 2 of the trial was designed as a five-period placebo- and active-controlled crossover trial. Fifteen subjects each received placebo, 2 mg of lorazepam, 15 mg of darigabat, 65 mg of darigabat and 65 mg of darigabat in combination with 2 mg of lorazepam in accordance with one of the sequences shown in the table below.

Treatment Sequences for Cohort 4

Lorazepam has been studied extensively using NeuroCart and has a distinctive signature of its GABAA receptor related pharmacology, including effects on saccadic eye movements as well as undesired effects on alertness, memory and body sway, many of which are believed to be mediated through alpha-1 pharmacology.

PD activity of darigabat in this trial was observed for the desired alpha-2/3 driven pharmacology, as demonstrated by SPV and surpassed the effect size demonstrated by lorazepam. The undesired, primarily alpha-1-driven pharmacology, as demonstrated by body

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sway and adaptive tracking, was observed to be lower for darigabat than with lorazepam. The full results from this trial are summarized below:

Dose-response effects of darigabat were also observed on saccadic reaction time, saccadic inaccuracy, visual analogue alertness and average reaction time for correct words.

Results from Part 2 of the trial, illustrated in the table below, demonstrated that, overall, darigabat showed a differentiated profile to lorazepam. Relative to 2 mg of lorazepam, 15 mg of darigabat demonstrated a larger decrease in SPV, corresponding to desired alpha-2/3 pharmacology, and a smaller impairment versus lorazepam on body sway, adaptive tracking and memory tests, corresponding to undesirable alpha-1/5 pharmacology seen with BZDs. The combination of darigabat and lorazepam (not illustrated) showed greater decrease in SPV and less reduction in adaptive tracking in comparison to lorazepam alone, suggesting little PD interaction between the two compounds.

All doses of darigabat were observed to be well tolerated. All treatment-related and trial-related AEs reported were mild. A maximum tolerated dose was not established and there were no reports of sedation in the trial. The most common AEs following dosing with darigabat were somnolence, dizziness, bradyphrenia, headache, fatigue, elevated mood and orthostatic hypotension.

Phase 1 Multiple Ascending Dose Trial in Healthy Volunteers

In February 2018, Pfizer completed Trial B7431011, a double-blind, randomized trial designed to evaluate the safety, tolerability and PK of repeat oral doses of darigabat in healthy adult volunteers.

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Eighteen healthy adult volunteers were enrolled and randomized into two cohorts and received twice daily, or BID, oral doses of darigabat over 21 days. One additional patient was enrolled into the trial but was withdrawn due to non-compliance. Each cohort included seven or eight subjects dosed with darigabat and two subjects dosed with placebo. All subjects received increasing doses of darigabat during the titration period in the first seven days, and the target dose was maintained for the remaining 14 days of the treatment period. In Cohort 1, subjects received 5 mg BID for three days, 12.5 mg BID for four days and 25 mg BID for 14 days. In Cohort 2, subjects received 5 mg BID for two days, 12.5 mg BID for two days, 25 mg BID for three days and 42.5 mg BID for 14 days. Serial PK samples were collected at selected time points on days one and 21. Safety evaluations conducted throughout the trial included AE monitoring, clinical laboratory tests, vital signs, electrocardiograms, or ECGs, and physical examinations.

Darigabat was rapidly absorbed with Cmax achieved at a median Tmax of one to two hours following both single- and multiple-dose administration. Mean terminal half-life on day 21 was 11.2 hours (25 mg BID) and 11.5 hours (42.5 mg BID), providing a PK rationale for twice-daily dosing.

All reported AEs were mild and a maximum tolerated dose was not identified. As illustrated below, no subjects reported somnolence after the titration period and no somnolence was observed in the 42.5 mg BID group.

No trial participants experienced withdrawal symptoms when darigabat was discontinued, despite treatment with doses achieving an estimated 80% GABAA receptor occupancy based on modeling data from the PET trial (B7431004). Changes in micronuclei frequency were measured as an exploratory endpoint in this trial and no changes were observed, providing further evidence that the doses evaluated were below the threshold at which micronuclei formation was observed preclinically.

Based on the results of this trial, which included a dose that exceeded our top target dose for our ongoing Phase 2 proof-of-concept trial in focal epilepsy, we believe darigabat may selectively enhance alpha-2/3/5 GABAergic activity at high receptor occupancy levels without sedation and minimal somnolence that is associated with alpha-1 subunit-containing receptors activation.

Incorporation by Reference

For more information about additional prior clinical trials and preclinical studies of darigabat, please see pages 23 to 24 and 27 to 28 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, which are incorporated herein by reference.

Ongoing Clinical Trials

REALIZE: Phase 2 Proof-of-Concept Trial in Focal Epilepsy

We are investigating darigabat in a Phase 2 proof-of-concept trial in approximately 150 patients with focal epilepsy. The focal epilepsy population is the largest subpopulation of epilepsy patients, and it is often studied to establish proof-of-concept in ASM development. The diagram below summarizes the design of the trial:

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This trial is designed to be a multi-center, randomized, double-blind, placebo-controlled, parallel-group trial to assess the efficacy, safety and tolerability of darigabat as adjunctive therapy in adult patients with focal epilepsy. The trial population will include patients with an appropriate severity level of disease to allow for the detection of anticonvulsant activity with darigabat. The key inclusion criteria include: (1) men and women 18 to 75 years of age with a diagnosis of epilepsy with focal onset as defined by the International League Against Epilepsy as focal aware, focal impaired awareness and focal to bilateral tonic-clonic seizures for at least two years; (2) drug resistance, defined as lack of seizure control despite the use of at least two prior ASMs; (3) current treatment with at least one but no more than three ASMs and (4) a history of an average of four or more spontaneous and observable seizures per 28-day period for at least three months.

After the eight-week screening period, 150 eligible patients who have suffered at least eight focal onset seizures during the screening period will be randomized 1:1:1 to one of the following three arms: 25 mg BID of darigabat; 7.5 mg BID of darigabat or placebo BID. The two doses of darigabat have been selected based on the safety and tolerability data from previous Phase 1 trials, the receptor occupancy modeling based on PET characterization and the doses used in the Phase 2 proof-of-principle photoepilepsy trial.

Throughout the screening period and over the course of the trial, patients will use an electronic seizure diary to capture their seizure events, which will enable assessment of change in seizure frequency between baseline, as assessed during the screening period, and following treatment. Following the eight-week screening period, eligible patients will enter a 13-week treatment period, which includes (1) a two-week titration phase, which was designed with the knowledge from prior clinical trials that somnolence side effects of darigabat may be mitigated by titration, (2) an eight-week maintenance phase and (3) either a three-week taper period or enrollment into REALIZE OLE, a 57-week open-label extension trial. The three-week taper phase is designed to mitigate possible risks of rebound seizures from too-rapid withdrawal from darigabat.

The primary endpoint to evaluate the efficacy of darigabat will be the reduction in frequency of focal onset seizures during the maintenance phase versus baseline as compared to the placebo group. This will be calculated as Rratio=(T-B)/(T+B) ×100, where T represents the seizure frequency rate per week in the maintenance phase and B represents the seizure frequency rate per week in the baseline screening period. The Rratio is between -100 and 100, where negative values will indicate reduction in seizure rate and positive values indicate increase in seizure rate during treatment. Reduction in seizure frequency using Rratio has been used as the primary endpoint in prior registrational trials of drugs for adjunctive treatment of focal epilepsy. Key secondary efficacy endpoints will include responder rate, defined as the percent of patients who experience at least a 50% reduction in focal onset seizure frequency compared to baseline, and seizure frequency per week over the eight-week maintenance phase. Safety parameters will include assessment of withdrawal symptoms during the taper phase of the trial.

We initiated the REALIZE trial in the second half of 2020. Enrollment in the REALIZE trial has been impacted due to the residual post-COVID environmental and other factors that are resulting in slower-than-expected enrollment in many clinical trials. As a result, we anticipate a delay in the REALIZE readout beyond 2023. Following a detailed review of all environmental factors, we plan to provide updated timing on the REALIZE readout by mid-year. The totality of the activity and tolerability data that will be generated in REALIZE, the Phase 2 proof-of-concept trial, and REALIZE OLE, the 57-week open-label extension trial, will guide further clinical development of darigabat in epilepsy. We also plan to conduct additional clinical pharmacology studies as appropriate.

Tavapadon

We are developing our most advanced product candidate, tavapadon, as both a monotherapy and adjunctive therapy to levodopa, or L-dopa, as a treatment for early- and late-stage Parkinson’s, a neurodegenerative disorder characterized by the death of dopamine-producing neurons in the brain, respectively. Tavapadon was rationally designed as an orally bioavailable, once-daily partial agonist that selectively targets dopamine D1/D5 receptor subtypes with the goal of balancing meaningful motor control activity with a

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favorable tolerability profile. To our knowledge, tavapadon is the only D1/D5 receptor partial agonist currently in clinical development for treatment of motor symptoms of Parkinson’s and the first oral D1/D5 receptor agonist to have achieved sustained motor control improvement in a Phase 2 trial of Parkinson’s. Based on extensive clinical data generated to date, including from three Phase 2 trials, we initiated a registration-directed Phase 3 program beginning in January 2020, which includes two trials as monotherapy in early-stage Parkinson’s, known as TEMPO-1 and TEMPO-2, one trial as adjunctive therapy in late-stage Parkinson’s, known as TEMPO-3, and an open-label extension trial, known as TEMPO-4. Following a detailed review of all environmental factors, data are expected from TEMPO-3 in mid-year 2024 and TEMPO-1 and TEMPO-2 in the second half of 2024.

Parkinson’s Disease Background

Parkinson’s is a chronic neurodegenerative disorder that primarily results in progressive and debilitating motor symptoms, including decreased bodily movement, or hypokinesia, slowness of movement, or bradykinesia, rigidity, tremor and postural instability. Dopamine is a neurotransmitter that drives motor function through a complex interaction between the striatum, the region of the brain responsible for motor control, the thalamus and the motor cortex. Patients with Parkinson’s lose dopamine-producing neurons in the substantia nigra, leading to increasingly reduced levels of dopamine in the striatum, which is believed to drive Parkinsonian motor symptoms. Parkinson’s is progressive in nature, and the later stages of the disease are marked by progressively lower levels of native dopamine production as an increasing number of dopamine-producing neurons die. The disease typically advances over decades before ultimately causing conditions that can lead to death.

According to the Parkinson’s Foundation, approximately one million people in the United States and approximately 10 million people worldwide suffer from Parkinson’s. Parkinson’s typically develops between the ages of 55 and 65 years and affects approximately 1% of people 60 years of age or older. As the overall global population continues to age, we expect that Parkinson’s will afflict an increasing number of patients.

The clinical diagnosis for Parkinson’s is well established and is based on the evaluation of both motor and non-motor symptoms. At the time of initial diagnosis, patients usually have a variety of mild, seemingly unrelated symptoms that are collectively non-debilitating. The current standards of care and their shortcomings are well understood. Treatments for early-stage Parkinson’s include monoamine oxidase-B, or MAO-B, inhibitors, which reduce the rate of endogenous dopamine metabolism, D2/D3-preferring dopamine agonists, which replace lost dopamine tone, and L-dopa, which increases dopamine concentration. Although these initial treatments for Parkinson’s are widely used, each treatment class has limitations that force patients to compromise between tolerability and efficacy.

MAO-B inhibitors are generally well tolerated, but normally demonstrate only modest impact on motor control, limiting use of these drugs to patients with mild symptoms or as an adjunctive therapy. Within two years, approximately 65% of patients on MAO-B inhibitors add medication and approximately 35% of patients on MAO-B inhibitors discontinue use.

Approved D2/D3-preferring agonists are full agonists of the D2/D3 receptor subtypes that are associated with meaningful motor control benefit, but have a challenging side-effect profile, including daytime sedation, or somnolence, compromised impulse control and risk of psychotic symptoms including hallucinations. Within two years, approximately 40% of patients on D2/D3-preferring agonists add medication and approximately 25% of patients on D2/D3-preferring agonists discontinue use. D2/D3 receptor subtypes are widely distributed in multiple non-motor-related brain circuits where over-activation can drive unwanted side effects. For example, repeated activation of D3 receptor subtypes in the reward-related nucleus accumbens may underpin the dysregulation of impulse control. D2/D3-preferring full agonism may also be associated with overexcitation of dopamine receptors, which may lead to increased dyskinesias when used adjunctively with L-dopa. The side effects of D2/D3-preferring agonists can negatively impact quality of life and may outweigh the benefits of treatment, especially in a population of early-stage Parkinson’s patients that are otherwise highly functional.

As the disease progresses, patients’ treatment regimens increasingly incorporate the use of L-dopa as either monotherapy or in combination with D2/D3-preferring agonists or MAO-B inhibitors. L-dopa is available in a number of formulations, including combinations with carbidopa, which is meant to allow for the use of lower doses of L-dopa to reduce nausea and vomiting side effects. Initial treatment with L-dopa typically results in a period of symptomatic relief for patients because L-dopa therapy transiently increases dopamine levels and affords rapid improvement of motor symptoms. Patients are typically initiated on L-dopa doses of 100 mg administered three times per day.

However, due to its short half-life, L-dopa transiently floods neurons with dopamine, resulting in fluctuating periods of high and low dopamine levels. These large fluctuations can cause the neurons in the brain to alter their response over time. With extended dosing, patients who use L-dopa begin to experience fluctuations between periods of insufficient motor control associated with Parkinson’s, known as “off” time, and periods of “on” time when they are not bothered by Parkinsonian motor deficits, but can be plagued by therapy-induced involuntary movement, known as dyskinesias. After starting L-dopa therapy, approximately 40% of patients experience “off” time within three to five years and between 30% and 40% of patients experience dyskinesias within five years. As the disease progresses, patients generally need to increase their L-dopa dose and frequency to maintain motor control. In the most advanced stages of disease, L-dopa doses can be as high as 2,000 mg total per day, requiring up to eight doses of L-dopa per day. This further exacerbates fluctuations and leads to more dyskinesias. The onset and intensity of L-dopa-induced dyskinesias are

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typically correlated with doses of at least 400 mg per day. The substantial and unpredictable swings between “off” time and dyskinesias can be attributed, in part, to the short half-life of L-dopa. In addition, high doses of L-dopa can be associated with psychosis, which may be further exacerbated by adjunctive use of D2/D3-preferring agonists. In order to delay the onset of such side effects, clinicians may delay recommending L-dopa until patients progress to later stages of Parkinson’s.

Our Solution—Tavapadon

Tavapadon is a selective partial agonist of the dopamine D1/D5 receptor subtypes expressed within the direct motor pathway that we are developing for the treatment of Parkinson’s. Key differentiating features of tavapadon include:

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We believe the expected clinical profile of tavapadon has the potential to become a standard of care across the treatment spectrum as both monotherapy in early-stage Parkinson's and as adjunctive therapy in late-stage Parkinson’s.

High-functioning early-stage Parkinson’s patients have adequate motor control on monotherapy with D2/D3-preferring agonists, but the side effects of these therapies are often more debilitating than Parkinson’s symptoms. On the other hand, while MAO-B inhibitors have a favorable side effect profile, only a small percentage of early-stage Parkinson’s patients are well-controlled on this class of drug due to limited efficacy. We believe that tavapadon’s potential for motor benefit similar to D2/D3-preferring agonists with a lower likelihood of their commonly-occurring severe side effects (such as excessive somnolence, hypotension and impulsive behavior) could ultimately enable tavapadon to displace these agents among early-stage Parkinson’s patients.

For the more advanced Parkinson’s patient who is no longer adequately treated with D2/D3-preferring agonists, tavapadon’s potential motor control benefit may create a treatment option to address motor control symptoms before adding L-dopa to the regimen. Furthermore, we believe tavapadon could be a preferred adjunctive treatment with L-dopa due to its longer half-life, potentially improved tolerability profile and reduced incidence of dyskinesias.

Finally, for the late-stage Parkinson’s patient already experiencing “off” time while on L-dopa, tavapadon use as an adjunctive therapy with L-dopa may provide 24-hour coverage and delay the need for L-dopa dose escalation, thus increasing “on” time without troublesome dyskinesias.

We believe our registration-directed Phase 3 program for tavapadon has the potential to establish tavapadon as the cornerstone treatment across the spectrum of Parkinson’s disease therapy—the preferred choice for the newly diagnosed patient and the ideal adjunctive therapy as the disease progresses.

Clinical Trials

As part of an extensive clinical program, tavapadon has been evaluated across 11 prior clinical trials, including five Phase 1 trials in healthy volunteers, three Phase 1/1b trials in patients with Parkinson's and three Phase 2 trials. A total of 294 subjects, including 113 healthy volunteers and 181 patients with Parkinson’s, have been exposed to tavapadon in completed trials.

Tavapadon has demonstrated activity in the treatment of motor symptoms, both as a monotherapy and as an adjunct to L-dopa. An open-label, multi-dose, Phase 1b trial of tavapadon demonstrated reduction in motor symptoms at the 15 mg dose, with a magnitude of effect comparable to results seen in the L-dopa arm of the trial and a duration consistent with tavapadon’s 24-hour half-life.

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In a Phase 2 trial in early-stage Parkinson’s, tavapadon demonstrated a statistically significant and clinically meaningful difference from placebo of -4.8 points on the MDS-UPDRS Part III motor score at week 15 of the treatment period. Separation from placebo was observed as early as week three while still in the titration phase. Statistical significance (p=0.0407) for this endpoint was achieved despite the trial being terminated early when only 65% of the planned trial population had been enrolled and even though only 42% of the patients who reached the maintenance period had received the top dose of 15 mg. In addition, at week 15, 50% of patients treated with tavapadon reported being “much improved” or “very much improved” on the Patient Global Impression of Improvement, an important qualitative assessment of meaningful change in overall patient condition and well-being.

A Phase 2 trial in late-stage Parkinson’s was terminated by Pfizer based on the results of an interim analysis, which determined that the probability of meeting the efficacy criterion for the primary endpoint of improvement in “off” time reduction compared to placebo at week 10 was lower than a pre-specified efficacy hurdle. As explained in more detail herein, we believe the pre-specified efficacy hurdle was a significant threshold to overcome given the limited duration of the trial. Despite the early termination of this trial, tavapadon showed a 1.0 hour improvement versus placebo in “on” time without troublesome dyskinesias at week 10 with a sustained effect observed through week 15, which, while not statistically significant, we and our clinical advisors believe is clinically meaningful.

Across the 11 clinical trials completed to date, tavapadon has consistently demonstrated what we believe to be a favorable tolerability profile as well as a PK profile with a 24-hour terminal half-life. Commonly reported AEs leading to discontinuation of tavapadon across all the clinical trials were nausea, vomiting, dyskinesia, falling, fatigue and sleep disorder. The occurrence of nausea increased with tavapadon dose and was often related to the rate of titration, which is a well-known occurrence with most dopamine receptor agonists. We believe that these gastrointestinal effects may be mitigated by the slower titration method that we plan to use in our registration-directed Phase 3 program. Headache was the most commonly reported CNS-related event across all clinical trials. Other commonly reported CNS-related AEs included dizziness, somnolence and tremor. The majority of all observed AEs were mild to moderate in severity.

In addition, preclinical studies of tavapadon in the well-established MPTP non-human primate model of Parkinson’s demonstrated robust and persistent activity and reduced incidence of dyskinesias relative to L-dopa. Tavapadon’s lack of abuse potential was also supported in a series of non-human primate studies.

We believe the results observed in the Phase 2 trials in Parkinson’s, together with the tolerability profile demonstrated throughout the clinical program to date, support an encouraging benefit-risk profile and strong rationale for our registration-directed Phase 3 program in Parkinson’s as well as tavapadon’s potential commercial impact.

The table below provides an overview of all clinical trials completed to date for tavapadon.

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Our prior and ongoing trials with tavapadon in Parkinson’s utilize three scales for patient selection: (1) either the Hoehn and Yahr scale or the modified Hoehn and Yahr scale; (2) the Movement Disorder Society-Unified Parkinson’s Disease Rating Scale, or MDS-UPDRS; and (3) the Hauser motor fluctuation patient diary. Two of these scales, MDS-UPDRS and the Hauser diary, are also used to measure therapeutic benefit.

The Hoehn and Yahr scale and modified Hoehn and Yahr scale are commonly accepted reference scales to measure disease progression in Parkinson’s, with stage one being the earliest and stage five being the most advanced. In clinical trials of tavapadon, the Hoehn and Yahr scale and the modified Hoehn and Yahr scale are used primarily for patient selection and enrollment.