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As filed with the Securities and Exchange Commission on August 8,September 20, 2019

Registration No. 333-232529

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Amendment No. 13
to
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

ANNOVIS BIO, INC.
(Exact name of registrant as specified in its charter)

1055 Westlakes Drive, Suite 300
Berwyn, PA 19312
Attention:
(610) 727-3913
(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

Maria Maccecchini, Ph.D.
President and Chief Executive Officer
Annovis Bio, Inc.
1055 Westlakes Drive, Suite 300
Berwyn, PA 19312
(610) 727-3913
(Name, address, including zip code, and telephone number, including area code, of agent for service)

Approximate date of commencement of proposed sale to the public:
As soon as practicable after this Registration Statement is declared effective.

          If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.    o

          If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

          If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

          If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

          Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a 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 7(a)(2)(B) of the Securities Act. ý

CALCULATION OF REGISTRATION FEE

(1)

Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended (the "Securities Act").

(2)

Includes common stock issuable upon exercise of the underwriter's option to purchase additional shares of common stock.

(3)

Calculated pursuant to Rule 457(o) based on an estimate of the proposed maximum aggregate offering price. The registration fee was previously paid.

          The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

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The information contained in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

1,428,571 Shares

Common Stock

ANNOVIS BIO, INC.

This is a firm commitment initial public offering of 1,428,571 shares of common stock of Annovis Bio, Inc. No public market currently exists for our shares. We anticipate that the initial public offering price of our shares will be between $$6.00 and $$8.00 and for calculation purposes herein, we assume a mid-point of $$7.00 per share.

We intend to applyhave applied to list our shares of common stock for trading on the NYSE American under the symbol "ANVS." No assurance can be given that our application will be approved.

We are an emerging growth company under the Jumpstart our Business Startups Act of 2012, or JOBS Act, and, as such, may elect to comply with certain reduced public company reporting requirements for future filings.

Investing in our common stock is highly speculative and involves a high degree of risk. See "Risk Factors" beginning on page 14 of this prospectus for a discussion of information that should be considered in connection with an investment in our common stock.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

We have granted the underwriters a 30-day45-day over-allotment option to purchase up to 214,285 additional shares of common stock at the initial public offering price less underwriting discounts and commissions.

The underwriters expect to deliver our shares to purchasers in the offering on or about          , 2019

ThinkEquity
a division of Fordham Financial Management, Inc.

The date of this prospectus is          , 2019

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        We have not authorized anyone to provide you with different information, and we take no responsibility for any other information others may give you. If anyone provides you with different or inconsistent information, you should not rely on it. We are not, and the underwriters are not, making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front of this prospectus.

        No action is being taken in any jurisdiction outside the United States to permit a public offering of our common stock or possession or distribution of this prospectus in that jurisdiction. Persons who come into possession of this prospectus in jurisdictions outside the United States are required to inform themselves about and to observe any restrictions as to this offering and the distribution of this prospectus applicable to that jurisdiction.

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RISK FACTORS

        You should carefully consider the risks and uncertainties described below and the other information in this prospectus before making an investment in our common stock. Our business, financial condition, results of operations or prospects could be materially and adversely affected if any of these risks occurs, and as a result, the market price of our common stock could decline, and you could lose all or part of your investment.

Risks Related to Our Financial Position and Need for Additional Capital

We have incurred losses since inception and anticipate that we will continue to incur losses for the foreseeable future. We are not currently profitable, and we may never achieve or sustain profitability.

        We are a clinical stage biopharmaceutical company with a limited operating history and have incurred losses since our formation. We incurred net losses of $0.7 million for each of the years ended December 31, 2018 and 2017, and $0.5 million and $0.4 million for the six month periods ended June 30, 2019 and 2018, respectively. As of June 30, 2019, we had an accumulated deficit of $8.3 million. We have not commercialized any products and have never generated revenue from the commercialization of any product. To date, we have devoted most of our financial resources to research and development, including our preclinical and clinical work, and to intellectual property.

        We expect to incur significant additional operating losses for the next several years, at least, as we advance ANVS-401 and any other product candidate through clinical development, complete clinical trials, seek regulatory approval and commercialize the drug or any other product candidate, if approved. The costs of advancing product candidates into each clinical phase tend to increase substantially over the duration of the clinical development process. Therefore, the total costs to advance any of our product candidates to marketing approval in even a single jurisdiction will be substantial. Because of the numerous risks and uncertainties associated with pharmaceutical product development, we are unable to accurately predict the timing or amount of increased expenses or when, or if, we will be able to begin generating revenue from the commercialization of any products or achieve or maintain profitability. Our expenses will also increase substantially if and as we:

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commence our two Phase 3 trials in AD-DS and in early PD, or conduct clinical trials for any other product candidates;



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are required by the U.S. Food and Drug Administration, or FDA to complete two Phase 3 trials to support a New Drug Application, or NDA for ANVS-401 in AD-DS or in PD;



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establish a sales, marketing and distribution infrastructure to commercialize our drug, if approved, and for any other product candidates for which we may obtain marketing approval;



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maintain, expand and protect our intellectual property portfolio;



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hire additional clinical, scientific and commercial personnel;



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add operational, financial and management information systems and personnel, including personnel to support our product development and planned future commercialization efforts, as well as to support our transition to a public reporting company; and



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acquire or in-license or invent other product candidates or technologies.

        Furthermore, our ability to successfully develop, commercialize and license any product candidates and generate product revenue is subject to substantial additional risks and uncertainties, as described under "—Risks Related to Development, Clinical Testing, Manufacturing and Regulatory Approval" and "—Risks Related to Commercialization." As a result, we expect to continue to incur net losses and negative cash flows for the foreseeable future. These net losses and negative cash flows have had, and will continue to have, an adverse effect on our stockholders' equity and working capital. The amount of

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our future net losses will depend, in part, on the rate of future growth of our expenses and our ability to generate revenues. If we are unable to develop and commercialize one or more product candidates, either alone or through collaborations, or if revenues from any product that receives marketing approval are insufficient, we will not achieve profitability. Even if we do achieve profitability, we may not be able to sustain profitability or meet outside expectations for our profitability. If we are unable to achieve or sustain profitability or to meet outside expectations for our profitability, the value of our common stock will be materially and adversely affected.

Even if this offering is successful, we will require additional capital to fund our operations, and if we fail to obtain necessary financing, we may not be able to complete the development and commercialization of ANVS-401.

        Our operations have consumed substantial amounts of cash since inception. We expect to continue to spend substantial amounts to advance the clinical development of ANVS-401 and launch and commercialize ANVS-401, if we receive regulatory approval. We will require additional capital for the further development and potential commercialization of ANVS-401 and may also need to raise additional funds sooner to pursue a more accelerated development of ANVS-401. If we are unable to raise capital when needed or on attractive terms, we could be forced to delay, reduce or eliminate our research and development programs or any future commercialization efforts.

        We believe that the net proceeds from this offering together with our existing cash and cash equivalents as of June 30, 2019, will enable us to fund our operating expenses and capital expenditure requirements for at least the next 18 months. We have based this estimate on assumptions that may prove to be wrong, and we could deploy our available capital resources sooner than we currently expect. Our future funding requirements, both near and long-term, will depend on many factors, including, but not limited to the:

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initiation, progress, timing, costs and results of preclinical studies and clinical trials, including patient enrollment in such trials, for ANVS-401 or any other future product candidates;



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clinical development plans we establish for ANVS-401 and any other future product candidates;



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obligation to make royalty and non-royalty sublicense receipt payments to third-party licensors, if any, under our licensing agreements;



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number and characteristics of product candidates that we discover or in-license and develop;



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outcome, timing and cost of regulatory review by the FDA and comparable foreign regulatory authorities, including the potential for the FDA or comparable foreign regulatory authorities to require that we perform more studies than those that we currently expect;



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costs of filing, prosecuting, defending and enforcing any patent claims and maintaining and enforcing other intellectual property rights;



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effects of competing technological and market developments;



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costs and timing of the implementation of commercial-scale manufacturing activities; and



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costs and timing of establishing sales, marketing and distribution capabilities for any product candidates for which we may receive regulatory approval.

        If we are unable to expand our operations or otherwise capitalize on our business opportunities due to a lack of capital, our ability to become profitable will be compromised.

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We, as well as our independent registered public accounting firm have expressed substantial doubt about our ability to continue as a going concern.

        Our recurring losses from operations raise substantial doubt about our ability to continue as a going concern. As a result, our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements for the year ended December 31, 2018 with respect to this uncertainty. Our ability to continue as a going concern will require us to obtain additional funding. We believe that the net proceeds from this offering and our existing cash and cash equivalents will be sufficient to fund our current operating plans through at least the next 18 months. We have based these estimates, however, on assumptions that may prove to be wrong, and we could spend our available financial resources much faster than we currently expect and need to raise additional funds sooner than we anticipate. If we are unable to raise capital when needed or on acceptable terms, we would be forced to delay, reduce or eliminate our research and development programs and commercialization efforts.

Raising additional capital may cause dilution to our stockholders, including purchasers of common stock in this offering, restrict our operations or require us to relinquish rights to our technologies or product candidates.

        Until such time, if ever, as we can generate substantial revenue, we may finance our cash needs through a combination of equity offerings, debt financings, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements or other sources. We do not currently have any committed external source of funds. In addition, we may seek additional capital due to favorable market conditions or strategic considerations, even if we believe that we have sufficient funds for our current or future operating plans.

        To the extent that we raise additional capital through the sale of equity or convertible debt securities, your ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a common stockholder. Debt financing and preferred equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may be required to relinquish valuable rights to our technologies, intellectual property, future revenue streams or product candidates or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate product candidate development or future commercialization efforts.

We have a limited operating history and no history of commercializing pharmaceutical products, which may make it difficult to evaluate the prospects for our future viability.

        We were established and began operations in 2008. Our operations to date have been limited to financing and staffing our company, licensing product candidates, conducting preclinical and clinical studies of ANVS-401 for treatment of AD-DS, AD and PD and for understanding its mechanism of action and its capability of stopping the toxic cascade that leads to nerve cell death. We have further tested ANVS-401 in clinical trials for safety and proof-of-concept. We have not yet demonstrated the ability to successfully complete a large-scale, pivotal clinical trial, obtain marketing approval, manufacture a commercial scale product, arrange for a third party to do so on our behalf, or conduct sales and marketing activities necessary for successful product commercialization. Consequently, predictions about our future success or viability may not be as accurate as they could be if we had a history of successfully developing and commercializing pharmaceutical products.

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        In addition, as a business with a limited operating history, we may encounter unforeseen expenses, difficulties, complications, delays and other known and unknown factors. We will eventually need to transition from a company with a research focus to a company capable of supporting commercial activities. We may not be successful in such a transition and, as a result, our business may be adversely affected.

        As we continue to build our business, we expect our financial condition and operating results may fluctuate significantly from quarter to quarter and year to year due to a variety of factors, many of which are beyond our control. Accordingly, you should not rely upon the results of any particular quarterly or annual period as indications of future operating performance.

Our ability to use our net operating loss carryforwards to offset future taxable income may be subject to certain limitations.

        As of June 30, 2019, we had net operating loss carryforwards, or NOLs, of $3.9 million for federal income tax purposes and $3.9 million for state income tax purposes, which may be available to offset our future taxable income, if any, and begin to expire in various amounts in 2028. NOLs of $1.1 million generated after December 31, 2017 are not subject to expiration but are limited to 80% of taxable income in future years.years for federal income tax purposes. In general, under SectionsSection 382 and 383 of the U.S. Internal Revenue Code of 1986, as amended, or the Code, a corporation that undergoes an "ownership change" is subject to limitations on its ability to use its pre-change NOLs to offset future taxable income. Due to previous ownership changes, or if we undergo an ownership change in connection with or after this offering, our ability to use our NOLs could be limited by Section 382 of the Code. Future changes in our stock ownership, some of which are outside of our control, could result in an ownership change under SectionsSection 382 and 383 of the Code. Furthermore, our ability to use NOLs of companies that we may acquire in the future may be subject to limitations. For these reasons, we may not be able to use a material portion of the NOLs, even if we attain profitability.

Risks Related to Development, Clinical Testing, Manufacturing and Regulatory Approval

We are heavily dependent on the success of ANVS-401, our most advanced product candidate, which is still under clinical development, and if this drug does not receive regulatory approval or is not successfully commercialized, our business may be harmed.

        We do not have any products that have gained regulatory approval. Currently, our lead clinical stage product candidate is ANVS-401. As a result, our business is dependent on our ability to successfully complete clinical development of, obtain regulatory approval for, and, if approved, successfully commercialize ANVS-401 in a timely manner. We cannot commercialize ANVS-401 in the United States without first obtaining regulatory approval from the FDA; similarly, we cannot commercialize ANVS-401 outside of the United States without obtaining regulatory approval from comparable foreign regulatory authorities. Before obtaining regulatory approvals for the commercial sale of ANVS-401 for a target indication, we must demonstrate with substantial evidence gathered in preclinical studies and clinical trials, generally including two adequate and well-controlled clinical trials, and, with respect to approval in the United States, to the satisfaction of the FDA, that ANVS-401 is safe and effective for use for that target indication and that the manufacturing facilities, processes and controls are adequate. Even if ANVS-401 were to successfully obtain approval from the FDA and comparable foreign regulatory authorities, any approval might contain significant limitations related to use restrictions for specified age groups, warnings, precautions or contraindications, or may be subject to burdensome post-approval study or risk management requirements. If we are unable to obtain regulatory approval for ANVS-401 in one or more jurisdictions, or any approval contains significant limitations, we may not be able to obtain sufficient funding or generate sufficient revenue to continue the development of any other product candidate that we may in-license, develop or acquire in the future. Furthermore, even if we obtain regulatory approval for ANVS-401, we will still need to develop

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a commercial organization, establish commercially viable pricing and obtain approval for adequate reimbursement from third-party and government payors. If we are unable to successfully commercialize ANVS-401, we may not be able to earn sufficient revenue to continue our business

Clinical trials are expensive, time-consuming and difficult to design and implement, and involve an uncertain outcome.

        Clinical testing is expensive and can take many years to complete, and its outcome is inherently uncertain. Failure can occur at any time during the clinical trial process. Because the results of preclinical studies and early clinical trials are not necessarily predictive of future results, ANVS-401 and our other compounds may not have favorable results in later preclinical and clinical studies or receive regulatory approval. We may experience delays in initiating and completing any clinical trials that we intend to conduct, and we do not know whether planned clinical trials, including our Phase 2a trial for PD will begin on time, need to be redesigned, enroll patients on time or be completed on schedule, or at all. Clinical trials can be delayed for a variety of reasons, including delays related to:

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the FDA or comparable foreign regulatory authorities disagreeing as to the design or implementation of our clinical studies;



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obtaining regulatory approval to commence a trial;



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reaching an agreement on acceptable terms with prospective contract research organizations, or CROs, and clinical trial sites, the terms of which can be subject to extensive negotiation and may vary significantly among different CROs and trial sites;



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obtaining Institutional Review Board, or IRB, approval at each site, or Independent Ethics Committee, or IEC, approval at sites outside the United States;



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recruiting suitable patients to participate in a trial in a timely manner and in sufficient numbers;



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having patients complete a trial or return for post-treatment follow-up;



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imposition of a clinical hold by regulatory authorities, including as a result of unforeseen safety issues or side effects or failure of trial sites to adhere to regulatory requirements or follow trial protocols;



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clinical sites deviating from trial protocol or dropping out of a trial;



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addressing patient safety concerns that arise during the course of a trial;



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adding a sufficient number of clinical trial sites; or



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manufacturing sufficient quantities of product candidate for use in clinical trials.

        We could also encounter delays if a clinical trial is suspended or terminated by us, the IRBs or IECs of the institutions in which such trials are being conducted, the Data Safety Monitoring Board, or DSMB, for such trial or the FDA or other regulatory authorities. Such authorities may impose such a suspension or termination due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection of the clinical trial operations or trial site by the FDA or other regulatory authorities resulting in the imposition of a clinical hold, unforeseen safety issues or adverse side effects, failure to demonstrate a benefit from using a drug, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial. Furthermore, we rely on CROs and clinical trial sites to ensure the proper and timely conduct of our clinical trials and, while we have agreements governing their committed activities, we have limited influence over their actual performance, as described in "—Risks Related to Our Dependence on Third Parties."

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The regulatory approval processes of the FDA and comparable foreign authorities are lengthy, time consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for ANVS-401 or any other product candidates, our business will be substantially harmed.

        The time required to obtain approval by the FDA and comparable foreign authorities is unpredictable but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including the substantial discretion of the regulatory authorities. In addition, approval policies, regulations or the type and amount of clinical data necessary to gain approval may change during the course of a product candidate's clinical development and may vary among jurisdictions. We have not obtained regulatory approval for any product candidate and it is possible that we will never obtain regulatory approval for ANVS-401 or any other product candidate. We are not permitted to market any of our product candidates in the United States until we receive regulatory approval of a New Drug Application (NDA)NDA from the FDA.

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we may be unable to demonstrate to the satisfaction of the FDA or comparable foreign regulatory authorities that a product candidate is safe and effective for its proposed indication;



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serious and unexpected drug-related side effects experienced by participants in our clinical trials or by individuals using drugs similar to our product candidates, or other products containing the active ingredient in our product candidates;



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negative or ambiguous results from our clinical trials or results that may not meet the level of statistical significance required by the FDA or comparable foreign regulatory authorities for approval;



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we may be unable to demonstrate that a product candidate's clinical and other benefits outweigh its safety risks;



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the FDA or comparable foreign regulatory authorities may disagree with our interpretation of data from preclinical studies or clinical trials;



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the data collected from clinical trials of our product candidates may not be acceptable or sufficient to support the submission of an NDA or other submission or to obtain regulatory approval in the United States or elsewhere, and we may be required to conduct additional clinical trials;



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the FDA or comparable foreign authorities may disagree regarding the formulation, labeling and/or the specifications of our product candidates;



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the FDA or comparable foreign regulatory authorities may fail to approve or find deficiencies with the manufacturing processes or facilities of third-party manufacturers with which we contract for clinical and commercial supplies; and



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the approval policies or regulations of the FDA or comparable foreign regulatory authorities may significantly change in a manner rendering our clinical data insufficient for approval.

        Prior to obtaining approval to commercialize a product candidate in the United States or abroad, we must demonstrate with substantial evidence from well-controlled clinical trials, and to the satisfaction of the FDA or foreign regulatory agencies, that such product candidates are safe and effective for their intended uses. Results from preclinical studies and clinical trials can be interpreted in different ways. Even if we believe the preclinical or clinical data for our product candidates are promising, such data may not be sufficient to support approval by the FDA and other regulatory authorities. For diseases like AD-DS, AD and PD, the FDA has stated that one single Phase 3 trial is adequate for approval, if it demonstrates robust and unquestionable efficacy. However, the circumstances under which a single adequate and controlled study can be used as the sole basis of demonstrating efficacy of a drug are exceptional.

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        The FDA or any foreign regulatory bodies can delay, limit or deny approval of our product candidates or require us to conduct additional preclinical or clinical testing or abandon a program for many reasons, including:

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the FDA or comparable foreign regulatory authorities may disagree with the design or implementation of our clinical trials;



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the FDA or comparable foreign regulatory authorities may disagree with our safety interpretation of our drug;



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the FDA or comparable foreign regulatory authorities may disagree with our efficacy interpretation of our drug;



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the FDA or comparable foreign regulatory authorities may regard our CMC package as inadequate.

        Of the large number of drugs in development, only a small percentage successfully complete the regulatory approval processes and are commercialized. This lengthy approval process, as well as the unpredictability of future clinical trial results, may result in our failing to obtain regulatory approval to market ANVS-401 or another product candidate, which would significantly harm our business, results of operations and prospects.

        In addition, the FDA or the applicable foreign regulatory agency also may approve a product candidate for a more limited indication or patient population than we originally requested, and the FDA or applicable foreign regulatory agency may approve a product candidate with a label that does not include the labeling claims necessary or desirable for the successful commercialization of that product candidate. Any of the foregoing scenarios could materially harm the commercial prospects for our product candidates.

We have concentrated our research and development efforts on the treatment of AD and PD, diseases that have seen limited success in drug development. Further, ANVS-401 is based on a new approach to treating AD and PD, which makes it difficult to predict the time and cost of development and subsequent obtaining of regulatory approval.

        Efforts by biopharmaceutical and pharmaceutical companies in treating AD and PD have seen limited success in drug development, and there are no FDA-approved disease modifying therapeutic options available for patients with AD and PD. We cannot be certain that our approach will lead to the development of approvable or marketable products. The only drugs approved by the FDA to treat AD and PD to date address the disease's symptoms. No new treatments have been approved for AD since 2003. Since 2003, over 500 clinical studies have been completed and no compound has shown efficacy. AD drug candidates have the highest failure rate of 100%, compared to 50% to 80% for all other drug candidates. As a result, the FDA has a limited set of products to rely on in evaluating ANVS-401. This could result in a longer than expected regulatory review process, increased expected development costs or the delay or prevention of commercialization of ANVS-401 for the treatment of AD and PD.

Enrollment and retention of patients in clinical trials is an expensive and time-consuming process and could be made more difficult or rendered impossible by multiple factors outside our control.

        The timely completion of clinical trials in accordance with their protocols depends, among other things, on our ability to enroll a sufficient number of patients who remain in the study until its conclusion. We may encounter delays in enrolling, or be unable to enroll, a sufficient number of patients to complete any of our clinical trials, and even once enrolled, we may be unable to retain a

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sufficient number of patients to complete any of our trials. Patient enrollment and retention in clinical trials depends on many factors, including:

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the patient eligibility criteria defined in the protocol;



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the size of the patient population required for analysis of the trial's primary endpoints;



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the nature of the trial protocol;



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the existing body of safety and efficacy data with respect to the product candidate;



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the proximity of patients to clinical sites;



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our ability to recruit clinical trial investigators with the appropriate competencies and experience;



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clinicians' and patients' perceptions as to the potential advantages of the product candidate being studied in relation to other available therapies, including any new drugs that may be approved for the indications we are investigating;



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competing clinical trials being conducted by other companies or institutions;



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our ability to maintain patient consents; and



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the risk that patients enrolled in clinical trials will drop out of the trials before completion.

Results of preclinical studies, early clinical trials or analyses may not be indicative of results obtained in later trials.

        The results of preclinical studies, early clinical trials or analyses of our product candidates may not be predictive of the results of later-stage clinical trials. Product candidates in later stages of clinical trials may fail to show the desired safety and efficacy traits despite having progressed through preclinical studies and initial clinical trials. A number of companies in the biopharmaceutical industry have suffered significant setbacks in advanced clinical trials due to lack of efficacy or adverse safety profiles, notwithstanding promising results in earlier trials. In addition, conclusions based on promising data from analyses of clinical results may be shown to be incorrect when implemented in prospective clinical trials. Even if our clinical trials for ANVS-401 are completed as planned, we cannot be certain that their results will support the safety and efficacy sufficient to obtain regulatory approval.

Interim "top-line" and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data.

        From time to time, we may publish interim "top-line" or preliminary data from our clinical studies. Interim data from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available. Preliminary or "top-line" data also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary data we previously published. As a result, interim and preliminary data should be viewed with caution until the final data are available. Adverse differences between preliminary or interim data and final data could significantly harm our business prospects.

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Our product candidates may cause serious adverse events or undesirable side effects, which may delay or prevent marketing approval, or, if approved, require them to be taken off the market, require them to include safety warnings or otherwise limit their sales.

        Serious adverse events or undesirable side effects caused by ANVS-401 or any other product candidates could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay or denial of regulatory approval by the FDA or other comparable foreign authorities. Results of any clinical trial we conduct could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics. Patients treated with ANVS-401 to date, at high doses have experienced adverse events that include nausea and vomiting.

        If unacceptable side effects arise in the development of our product candidates, we, the FDA or the IRBs at the institutions in which our studies are conducted, or the DSMB, if constituted for our clinical trials, could recommend a suspension or termination of our clinical trials, or the FDA or comparable foreign regulatory authorities could order us to cease further development of or deny approval of a product candidate for any or all targeted indications. In addition, drug-related side effects could affect patient recruitment or the ability of enrolled patients to complete a trial or result in potential product liability claims. In addition, these side effects may not be appropriately recognized or managed by the treating medical staff. We expect to have to train medical personnel using our product candidates to understand the side effect profiles for our clinical trials and upon any commercialization of any of our product candidates. Inadequate training in recognizing or managing the potential side effects of our product candidates could result in patient injury or death. Any of these occurrences may harm our business, financial condition and prospects significantly.

        Additionally, if one or more of our product candidates receives marketing approval, and we or others later identify undesirable side effects caused by such products, a number of potentially significant negative consequences could result, including:

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regulatory authorities may withdraw approvals of such product;



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regulatory authorities may require additional warnings on the label, such as a "black box" warning or contraindication;



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additional restrictions may be imposed on the marketing of the particular product or the manufacturing processes for the product or any component thereof;



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we may be required to implement a Risk Evaluation and Mitigation Strategy, or REMS, or create a medication guide outlining the risks of such side effects for distribution to patients;



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we could be sued and held liable for harm caused to patients;



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the product may become less competitive; and



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our reputation may suffer.

        Any of these events could prevent us from achieving or maintaining market acceptance of a product candidate, if approved, and could significantly harm our business, results of operations and prospects.

The market opportunities for ANVS-401, if approved, may be smaller than we anticipate.

        We expect to initially seek approval for ANVS-401 for AD-DS, AD and PD in the US. Our estimates of market potential have been derived from a variety of sources, including scientific literature, patient foundations and market research, and may prove to be incorrect. Even if we obtain significant market share for any product candidate, if approved, if the potential target populations are small, we may never achieve profitability without obtaining marketing approval for additional indications.

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We have never obtained marketing approval for a product candidate and we may be unable to obtain, or may be delayed in obtaining, marketing approval for any of our product candidates.

        We have never obtained marketing approval for a product candidate. It is possible that the FDA may refuse to accept for substantive review any NDAs that we submit for our product candidates or may conclude after review of our data that our application is insufficient to obtain marketing approval of our product candidates. If the FDA does not accept or approve our NDAs for our product candidates, it may require that we conduct additional clinical, preclinical or manufacturing validation studies and submit that data before it will reconsider our applications. Depending on the extent of these or any other FDA-required studies, approval of any NDA that we submit may be delayed or may require us to expend more resources than we have available. It is also possible that additional studies, if performed and completed, may not be considered sufficient by the FDA to approve our NDAs.

        Any delay in obtaining, or an inability to obtain, marketing approvals would prevent us from commercializing our product candidates, generating revenues and achieving and sustaining profitability. If any of these outcomes occur, we may be forced to abandon our development efforts for our product candidates, which could significantly harm our business.

Even if we obtain FDA approval for ANVS-401 or any other product candidate in the United States, we may never obtain approval for or commercialize ANVS-401 or any other product candidate in any other jurisdiction, which would limit our ability to realize their full market potential.

        In order to market any products in any particular jurisdiction, we must establish and comply with numerous and varying regulatory requirements on a country-by-country basis regarding safety and efficacy. Approval by the FDA in the United States does not ensure approval by regulatory authorities in other countries or jurisdictions. However, the failure to obtain approval in one jurisdiction may negatively impact our ability to obtain approval elsewhere. In addition, clinical trials conducted in one country may not be accepted by regulatory authorities in other countries, and regulatory approval in one country does not guarantee regulatory approval in any other country.

        Approval processes vary among countries and can involve additional product testing and validation and additional administrative review periods. Seeking foreign regulatory approval could result in difficulties and increased costs for us and require additional preclinical studies or clinical trials which could be costly and time consuming. Regulatory requirements can vary widely from country to country and could delay or prevent the introduction of our products in those countries. We do not have any product candidates approved for sale in any jurisdiction, including in international markets, and we do not have experience in obtaining regulatory approval in international markets. If we fail to comply with regulatory requirements in international markets or to obtain and maintain required approvals, or if regulatory approvals in international markets are delayed, our target market will be reduced and our ability to realize the full market potential of any product we develop will be unrealized.

Even if we obtain regulatory approval for ANVS-401 or any product candidate, we will still face extensive and ongoing regulatory requirements and obligations and any product candidates, if approved, may face future development and regulatory difficulties.

        Any product candidate for which we obtain marketing approval, along with the manufacturing processes, post-approval clinical data, labeling, packaging, distribution, adverse event reporting, storage, recordkeeping, export, import, advertising and promotional activities for such product, among other things, will be subject to extensive and ongoing requirements of and review by the FDA and other regulatory authorities. These requirements include submissions of safety and other post-marketing information and reports, establishment registration and drug listing requirements, continued compliance with current Good Manufacturing Practice, or cGMP, requirements relating to manufacturing, quality control, quality assurance and corresponding maintenance of records and documents, requirements

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regarding the distribution of samples to physicians and recordkeeping and Good Clinical Practice, or GCP, requirements for any clinical trials that we conduct post-approval.

        Even if marketing approval of a product candidate is granted, the approval may be subject to limitations on the indicated uses for which the product candidate may be marketed or to the conditions of approval, including a requirement to implement a REMS. If any of our product candidates receive marketing approval, the accompanying label may limit the approved indicated use of the product candidate, which could limit sales of the product candidate. The FDA may also impose requirements for costly post-marketing studies or clinical trials and surveillance to monitor the safety or efficacy of a product. The FDA closely regulates the post-approval marketing and promotion of drugs to ensure drugs are marketed only for the approved indications and in accordance with the provisions of the approved labeling. The FDA imposes stringent restrictions on manufacturers' communications regarding off-label use, and if we market our products for uses beyond their approved indications, we may be subject to enforcement action for off-label marketing. Violations of the Federal Food, Drug, and Cosmetic Act, or FDCA, relating to the promotion of prescription drugs may lead to FDA enforcement actions and investigations alleging violations of federal and state healthcare fraud and abuse laws, as well as state consumer protection laws.

        In addition, later discovery of previously unknown adverse events or other problems with our products, manufacturers or manufacturing processes or failure to comply with regulatory requirements, may yield various results, including:

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restrictions on manufacturing such products;



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restrictions on the labeling or marketing of products;



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restrictions on product distribution or use;



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requirements to conduct post-marketing studies or clinical trials;



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warning letters or untitled letters;



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withdrawal of the products from the market;



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refusal to approve pending applications or supplements to approved applications that we submit;



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recall of products;



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fines, restitution or disgorgement of profits or revenues;



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suspension or withdrawal of marketing approvals;



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refusal to permit the import or export of our products;



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product seizure; or



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injunctions or the imposition of civil or criminal penalties.

        Further, the FDA's policies may change, and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained, which would adversely affect our business, prospects and ability to achieve or sustain profitability.

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        We also cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative or executive action, either in the United States or abroad. For example, certain policies of the current presidential administration may impact our business and industry. Namely, the current presidential administration has taken several executive actions, including the issuance of a number of Executive Orders, that could impose significant burdens on, or otherwise materially delay, the FDA's ability to engage in routine regulatory and oversight activities such as implementing statutes through rulemaking, issuance of guidance, and review and approval of marketing applications. It is difficult to predict how these executive actions will be implemented, and the extent to which they will impact the FDA's ability to exercise its regulatory authority. If these executive actions impose constraints on FDA's ability to engage in oversight and implementation activities in the normal course, our business may be negatively impacted.

We may seek a Breakthrough Therapy designation for ANVS-401 from the FDA at the end of the two Phase 2a studies in AD and PD, respectively. However, we might not receive such designation, and even if we do, such designation may not lead to a faster development or regulatory review or approval process.

        We may seek a Breakthrough Therapy designation for ANVS-401 or one or more of our other product candidates. A Breakthrough Therapy is defined as a drug that is intended, alone or in combination with one or more other drugs, to treat a serious condition, and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. For drugs that have been designated as breakthrough therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient path for clinical development while minimizing the number of patients placed in ineffective control regimens. Drugs designated as breakthrough therapies by the FDA may also be eligible for priority review if supported by clinical data at the time the NDA is submitted to the FDA.

        Designation as a Breakthrough Therapy is within the discretion of the FDA. Accordingly, even if we believe that one of our product candidates meets the criteria for designation as a Breakthrough Therapy, the FDA may disagree and instead determine not to make such designation. Even if we receive Breakthrough Therapy designation, the receipt of such designation for a product candidate may not result in a faster development or regulatory review or approval process compared to drugs considered for approval under conventional FDA procedures and does not assure ultimate approval by the FDA. In addition, even if one or more of our product candidates qualify as breakthrough therapies, the FDA may later decide that the product candidates no longer meet the conditions for qualification or decide that the time period for FDA review or approval will not be shortened.

Potential product liability lawsuits against us could cause us to incur substantial liabilities and limit commercialization of any products that we may develop.

        The use of ANVS-401 or any other product candidates we may develop in clinical trials and the sale of any products for which we obtain marketing approval exposes us to the risk of product liability claims. Product liability claims might be brought against us by patients, healthcare providers, pharmaceutical companies or others selling or otherwise coming into contact with our products. On occasion, large judgments have been awarded in class action lawsuits based on drugs that had unanticipated adverse effects. If we cannot successfully defend against product liability claims, we could incur substantial liability and costs. In addition, regardless of merit or eventual outcome, product liability claims may result in:

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impairment of our business reputation and significant negative media attention;



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withdrawal of participants from our clinical trials;



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significant costs to defend the litigation;

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distraction of management's attention from our primary business;



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substantial monetary awards to patients or other claimants;



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inability to commercialize ANVS-401 or any other product candidate;



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product recalls, withdrawals or labeling, marketing or promotional restrictions;



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decreased market demand for any product; and



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loss of revenue.

        The product liability insurance we currently carry, and any additional product liability insurance coverage we acquire in the future may not be sufficient to reimburse us for any expenses or losses we may suffer. In connection with our Phase 1 clinical studies, we carried insurance of $2.0 million in the aggregate for product liability claims in the United States. We intend to acquire insurance coverage to include larger clinical studies, different countries and sale of commercial products; however, we may be unable to obtain product liability insurance on commercially reasonable terms or in adequate amounts. A successful product liability claim, or series of claims, brought against us could cause our share price to decline and, if judgments exceed our insurance coverage, could adversely affect the results of our operations and business, including preventing or limiting the commercialization of any product candidates we develop.

Risks Related to Commercialization

We face significant competition from other biotechnology and pharmaceutical companies and our operating results will suffer if we fail to compete effectively.

        The biopharmaceutical and pharmaceutical industries are highly competitive and subject to significant and rapid technological change. Our success is highly dependent on our ability to acquire, develop, and obtain marketing approval for new products on a cost-effective basis and to market them successfully. If ANVS-401 is approved, we will face intense competition from a variety of businesses, including large, fully integrated pharmaceutical companies, specialty pharmaceutical companies and biopharmaceutical companies in the United States and other jurisdictions. These organizations may have significantly greater resources than we do and may conduct similar research; seek patent protection; and establish collaborative arrangements for research, development, manufacturing and marketing of products that may compete with us.

        Our competitors may, among other things:

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have significantly greater name recognition, financial, manufacturing, marketing, drug development, technical, and human resources than we do, and future mergers and acquisitions in the biotechnology and pharmaceutical industries may result in even more resources being concentrated in our competitors;



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develop and commercialize products that are safer, more effective, less expensive, more convenient, or easier to administer, or have fewer or less severe effects;



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obtain quicker regulatory approval;



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implement more effective approaches to sales and marketing; or



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form more advantageous strategic alliances.

        Smaller and other early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These third parties compete with us in recruiting and retaining qualified scientific and management personnel; establishing clinical trial sites and patient registration; and in acquiring technologies complementary to, or necessary for,

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our programs. Our commercial opportunity could be reduced or eliminated if our competitors develop

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and commercialize products that are more effective, have fewer or less severe side effects, or are more convenient or are less expensive than ANVS-401. Our competitors may also obtain FDA or other regulatory approval for their product candidates more rapidly than we may obtain approval for ANVS-401, which could result in our competitors establishing or strengthening their market position before we are able to enter the market.

The successful commercialization of ANVS-401 and any other product candidate we develop will depend in part on the extent to which governmental authorities and health insurers establish adequate coverage, reimbursement levels, and pricing policies. Failure to obtain or maintain coverage and adequate reimbursement for our product candidates, if approved, could limit our ability to market those products and decrease our ability to generate revenue.

        The availability and adequacy of coverage and reimbursement by governmental healthcare programs such as Medicare and Medicaid, private health insurers and other third-party payors are essential for most patients to be able to afford prescription medications such as ANVS-401, if approved. Our ability to achieve acceptable levels of coverage and reimbursement for products by governmental authorities, private health insurers and other organizations will have an effect on our ability to successfully commercialize our drug and any other product candidates we develop. Assuming we obtain coverage for our product candidates by a third-party payor, the resulting reimbursement payment rates may not be adequate or may require co-payments that patients find unacceptably high. We cannot be sure that coverage and reimbursement in the United States or elsewhere will be available for our product candidates or any product that we may develop, and any reimbursement that may become available may be decreased or eliminated in the future.

        Third-party payors increasingly are challenging prices charged for pharmaceutical products and services, and many third-party payors may refuse to provide coverage and reimbursement for particular drugs or biologics when an equivalent generic drug, biosimilar, or a less expensive therapy is available. It is possible that a third-party payor may consider our product candidates as substitutable and offer to reimburse patients only for the less expensive product. Even if we show improved efficacy or improved convenience of administration with our product candidates, pricing of existing drugs may limit the amount we will be able to charge for our product candidates. These payors may deny or revoke the reimbursement status of a given product or establish prices for new or existing marketed products at levels that are too low to enable us to realize an appropriate return on our investment in our product candidates. If reimbursement is not available or is available only at limited levels, we may not be able to successfully commercialize our product candidates and may not be able to obtain a satisfactory financial return on our product candidates.

        There is significant uncertainty related to the insurance coverage and reimbursement of newly approved products. In the United States, third-party payors, including private and governmental payors, such as the Medicare and Medicaid programs, play an important role in determining the extent to which new drugs and biologics will be covered. The Medicare and Medicaid programs increasingly are used as models in the United States for how private payors and other governmental payors develop their coverage and reimbursement policies for drugs and biologics. Some third-party payors may require pre-approval of coverage for new or innovative devices or drug therapies before they will reimburse healthcare providers who use such therapies. It is difficult to predict at this time what third-party payors will decide with respect to the coverage and reimbursement for our product candidates.

        No uniform policy for coverage and reimbursement for products exists among third-party payors in the United States. Therefore, coverage and reimbursement for products can differ significantly from payor to payor. As a result, the coverage determination process is often a time-consuming and costly process that will require us to provide scientific and clinical support for the use of our product candidates to each payor separately, with no assurance that coverage and adequate reimbursement will

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be applied consistently or obtained in the first instance. Furthermore, rules and regulations regarding

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reimbursement change frequently, in some cases at short notice, and we believe that changes in these rules and regulations are likely.

        We may also be subject to extensive governmental price controls and other market regulations outside of the United States, and we believe the increasing emphasis on cost-containment initiatives in other countries have and will continue to put pressure on the pricing and usage of medical products. In many countries, the prices of medical products are subject to varying price control mechanisms as part of national health systems. Other countries allow companies to fix their own prices for medical products but monitor and control company profits.

        Additional foreign price controls or other changes in pricing regulation could restrict the amount that we are able to charge for our product candidates. Accordingly, in markets outside the United States, the reimbursement for our product candidates may be reduced compared with the United States and may be insufficient to generate commercially reasonable revenue and profits.

        Moreover, increasing efforts by governmental and third-party payors in the United States to cap or reduce healthcare costs may cause such organizations to limit both coverage and the level of reimbursement for newly approved products and, as a result, they may not cover or provide adequate payment for our product candidates. We expect to experience pricing pressures in connection with the sale of our product candidates due to the trend toward managed health care, the increasing influence of health maintenance organizations and additional legislative changes. The downward pressure on healthcare costs in general, particularly prescription drugs and biologics and surgical procedures and other treatments, has become intense. As a result, increasingly high barriers are being erected to the entry of new products.

Even if ANVS-401 or any product candidate we develop receives marketing approval, it may fail to achieve market acceptance by physicians, patients, third-party payors or others in the medical community necessary for commercial success.

        If ANVS-401 or any product candidate we develop receives marketing approval, it may nonetheless fail to gain sufficient market acceptance by physicians, patients, third-party payors and others in the medical community. If it does not achieve an adequate level of acceptance, we may not generate significant product revenues or become profitable. The degree of market acceptance of our product candidates, if approved, will depend on a number of factors, including but not limited to:

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the efficacy and potential advantages compared to alternative treatments;



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effectiveness of sales and marketing efforts;



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the cost of treatment in relation to alternative treatments, including any similar generic treatments;



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our ability to offer our products for sale at competitive prices;



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the convenience and ease of administration compared to alternative treatments;



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the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies;



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the strength of marketing and distribution support;



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the availability of third-party coverage and adequate reimbursement;



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the prevalence and severity of any side effects; and



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any restrictions on the use of our product together with other medications.

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        Because we expect sales of our product candidates, if approved, to generate substantially all of our revenues for the foreseeable future, the failure of our product candidates to find market acceptance would harm our business and could require us to seek additional financing.

If we are unable to establish sales, marketing and distribution capabilities either on our own or in collaboration with third parties, we may not be successful in commercializing ANVS-401, if approved.

        We do not have any infrastructure for the sales, marketing or distribution of ANVS-401, and the cost of establishing and maintaining such an organization may exceed the cost-effectiveness of doing so. In order to market and successfully commercialize our drug or any product candidate we develop, if approved, we must build our sales, distribution, marketing, managerial and other non-technical capabilities or make arrangements with third parties to perform these services. We expect to build a focused sales, distribution and marketing infrastructure to market ANVS-401, if approved, in the United States and Europe. There are significant expenses and risks involved with establishing our own sales, marketing and distribution capabilities, including our ability to hire, retain and appropriately incentivize qualified individuals, generate sufficient sales leads, provide adequate training to sales and marketing personnel and effectively manage a geographically dispersed sales and marketing team. Any failure or delay in the development of our internal sales, marketing and distribution capabilities could delay any product launch, which would adversely impact the commercialization of that product. For example, if the commercial launch of ANVS-401 for which we recruit a sales force and establish marketing capabilities is delayed or does not occur for any reason, we would have prematurely or unnecessarily incurred these commercialization expenses. This may be costly, and our investment would be lost if we cannot retain or reposition our sales and marketing personnel.

        Factors that may inhibit our efforts to commercialize our product candidates on our own include:

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our inability to recruit, train and retain adequate numbers of effective sales and marketing personnel;



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the inability of sales personnel to obtain access to physicians or attain adequate numbers of physicians to prescribe our products; and



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unforeseen costs and expenses associated with creating an independent sales and marketing organization.

        We do not anticipate having the resources in the foreseeable future to allocate to the sales and marketing of our product candidates, if approved, in certain markets overseas. Therefore, our future success will depend, in part, on our ability to enter into and maintain collaborative relationships for such capabilities, the collaborator's strategic interest in a product and such collaborator's ability to successfully market and sell the product. We intend to pursue collaborative arrangements regarding the sale and marketing of ANVS-401, if approved, for certain markets overseas; however, we cannot assure you that we will be able to establish or maintain such collaborative arrangements, or if able to do so, that they will have effective sales forces. To the extent that we depend on third parties for marketing and distribution, any revenues we receive will depend upon the efforts of such third parties, and there can be no assurance that such efforts will be successful.

        If we are unable to build our own sales force or negotiate a collaborative relationship for the commercialization of ANVS-401, we may be forced to delay the potential commercialization of the drug or reduce the scope of our sales or marketing activities. If we need to increase our expenditures to fund commercialization activities for ANVS-401 we will need to obtain additional capital, which may not be available to us on acceptable terms, or at all. We may also have to enter into collaborative arrangements for ANVS-401 at an earlier stage than otherwise would be ideal and we may be required to relinquish rights to it or otherwise agree to terms unfavorable to us. Any of these occurrences may have an adverse effect on our business, operating results and prospects.

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        If we are unable to establish adequate sales, marketing and distribution capabilities, either on our own or in collaboration with third parties, we will not be successful in commercializing our product candidates and may never become profitable. We will be competing with many companies that currently have extensive and well-funded marketing and sales operations. Without an internal team or the support of a third party to perform marketing and sales functions, we may be unable to compete successfully against these more established companies.

A variety of risks associated with operating internationally could materially adversely affect our business.

        We currently have no international operations, but our business strategy includes potentially expanding internationally if any of our product candidates receive regulatory approval. Doing business internationally involves a number of risks, including but not limited to:

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multiple, conflicting and changing laws and regulations, such as privacy regulations, tax laws, export and import restrictions, employment laws, regulatory requirements and other governmental approvals, permits and licenses;



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failure by us to obtain and maintain regulatory approvals for the use of our products in various countries;



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additional potentially relevant third-party patent rights;



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complexities and difficulties in obtaining protection and enforcing our intellectual property;



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difficulties in staffing and managing foreign operations;



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complexities associated with managing multiple payor reimbursement regimes, government payors or patient self-pay systems;



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limits in our ability to penetrate international markets;



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financial risks, such as longer payment cycles, difficulty collecting accounts receivable, the impact of local and regional financial crises on demand and payment for our products and exposure to foreign currency exchange rate fluctuations;



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natural disasters, political and economic instability, including wars, terrorism and political unrest, outbreak of disease, boycotts, curtailment of trade and other business restrictions;



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certain expenses including, among others, expenses for travel, translation and insurance; and



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regulatory and compliance risks that relate to maintaining accurate information and control over sales and activities that may fall within the purview of the U.S. Foreign Corrupt Practices Act, its books and records provisions, or its anti-bribery provisions.

        Any of these factors could significantly harm any future international expansion and operations and, consequently, our results of operations.

Risks Related to Our Dependence on Third Parties

Our employees and independent contractors, including principal investigators, CROs, consultants, vendors, and any third parties we may engage in connection with development and commercialization, may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could have a material adverse effect on our business.

        Our employees and independent contractors, including principal investigators, consultants, vendors and any third parties we may engage in connection with development and commercialization of our product candidates, could engage in misconduct, including intentional, reckless or negligent conduct or unauthorized activities that violate: the laws and regulations of the FDA or other similar regulatory

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requirements of other authorities, including those laws that require the reporting of true, complete and accurate information to such authorities; manufacturing standards; data privacy, security, fraud and abuse and other healthcare laws and regulations; or laws that require the reporting of true, complete and accurate financial information and data. Specifically, sales, marketing and business arrangements in the healthcare industry are subject to extensive laws and regulations intended to prevent fraud, misconduct, kickbacks, self-dealing and other abusive practices. These laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, sales commission, customer incentive programs and other business arrangements. Activities subject to these laws could also involve the improper use or misrepresentation of information obtained in the course of clinical trials, creation of fraudulent data in preclinical studies or clinical trials or illegal misappropriation of drug product, which could result in regulatory sanctions and cause serious harm to our reputation. It is not always possible to identify and deter misconduct by employees and other third parties, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to comply with such laws or regulations. Additionally, we are subject to the risk that a person or government could allege such fraud or other misconduct, even if none occurred. If any such actions are instituted against us and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business and results of operations, including the imposition of significant civil, criminal and administrative penalties, damages, monetary fines, disgorgements, possible exclusion from participation in Medicare, Medicaid, other U.S. federal healthcare programs or healthcare programs in other jurisdictions, individual imprisonment, other sanctions, contractual damages, reputational harm, diminished profits and future earnings, and curtailment of our operations.

We currently rely on third-party contract manufacturing organizations, or CMOs, for the production of clinical supply of ANVS-401 and intend to rely on CMOs for the production of commercial supply of ANVS-401, if approved. Our dependence on CMOs may impair the development and commercialization of the drug, which would adversely impact our business and financial position.

        We have limited personnel with experience in manufacturing, and we do not own facilities for manufacturing. Instead, we rely on and expect to continue to rely on CMOs for the supply of cGMP grade clinical trial materials and commercial quantities of ANVS-401 and any product candidates we develop, if approved. Reliance on CMOs may expose us to more risk than if we were to manufacture our product candidates ourselves. We intend to have manufactured a sufficient clinical supply of ANVS-401 drug substance to enable us to complete our clinical trials, and we have also engaged a CMO to provide clinical and commercial supply of the drug product.

        The facilities used to manufacture our product candidates must be inspected by the FDA and comparable foreign authorities. While we provide oversight of manufacturing activities, we do not and will not control the execution of manufacturing activities by, and are or will be essentially dependent on, our CMOs for compliance with cGMP requirements for the manufacture of our product candidates. As a result, we are subject to the risk that our product candidates may have manufacturing defects that we have limited ability to prevent. If a CMO cannot successfully manufacture material that conforms to our specifications and the regulatory requirements, we will not be able to secure or maintain regulatory approval for the use of our product candidates in clinical trials, or for commercial distribution of our product candidates, if approved. In addition, we have limited control over the ability of our CMOs to maintain adequate quality control, quality assurance and qualified personnel. If the FDA or comparable foreign regulatory authority finds deficiencies with or does not approve these facilities for the manufacture of our product candidates or if it withdraws any such approval or finds deficiencies in the future, we may need to find alternative manufacturing facilities, which would delay our development program and significantly impact our ability to develop, obtain regulatory approval for or commercialize our product candidates, if approved. In addition, any failure to achieve and maintain compliance with

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these laws, regulations and standards could subject us to the risk that we may have to suspend the manufacture of our product candidates or that obtained approvals could be revoked. Furthermore, CMOs may breach existing agreements they have with us because of factors beyond our control. They may also terminate or refuse to renew their agreement at a time that is costly or otherwise inconvenient for us. If we were unable to find an adequate CMO or another acceptable solution in time, our clinical trials could be delayed, or our commercial activities could be harmed.

        We rely on and will continue to rely on CMOs to purchase from third-party suppliers the raw materials necessary to produce our product candidates. We do not and will not have control over the process or timing of the acquisition of these raw materials by our CMOs. Moreover, we currently do not have any agreements for the production of these raw materials. Supplies of raw material could be interrupted from time to time and we cannot be certain that alternative supplies could be obtained within a reasonable timeframe, at an acceptable cost, or at all. In addition, a disruption in the supply of raw materials could delay the commercial launch of our product candidates, if approved, or result in a shortage in supply, which would impair our ability to generate revenues from the sale of our product candidates. Growth in the costs and expenses of raw materials may also impair our ability to cost effectively manufacture our product candidates. There are a limited number of suppliers for the raw materials that we may use to manufacture our product candidates and we may need to assess alternative suppliers to prevent a possible disruption of the manufacture of our product candidates.

        Finding new CMOs or third-party suppliers involves additional cost and requires our management's time and focus. In addition, there is typically a transition period when a new CMO commences work. Although we generally have not, and do not intend to, begin a clinical trial unless we believe we have on hand, or will be able to obtain, a sufficient supply of our product candidates to complete the clinical trial, any significant delay in the supply of our product candidates or the raw materials needed to produce our product candidates, could considerably delay conducting our clinical trials and potential regulatory approval of our product candidates.

        As part of their manufacture of our product candidates, our CMOs and third-party suppliers are expected to comply with and respect the proprietary rights of others. If a CMO or third-party supplier fails to acquire the proper licenses or otherwise infringes the proprietary rights of others in the course of providing services to us, we may have to find alternative CMOs or third-party suppliers or defend against claims of infringement, either of which would significantly impact our ability to develop, obtain regulatory approval for or commercialize our product candidates, if approved.

We intend to rely on third parties to conduct, supervise and monitor our clinical trials. If those third parties do not successfully carry out their contractual duties, or if they perform in an unsatisfactory manner, it may harm our business.

        We rely, and will continue to rely, on CROs, CRO-contracted vendors and clinical trial sites to ensure the proper and timely conduct of our clinical trials, including our two Phase 2 trials of ANVS-401. Our reliance on CROs for clinical development activities limits our control over these activities, but we remain responsible for ensuring that each of our trials is conducted in accordance with the applicable protocol and legal, regulatory and scientific standards.

        We and our CROs will be required to comply with the Good Laboratory Practice requirements for our preclinical studies and GCP requirements for our clinical trials, which are regulations and guidelines enforced by the FDA and are also required by comparable foreign regulatory authorities. Regulatory authorities enforce GCP requirements through periodic inspections of trial sponsors, principal investigators and clinical trial sites. If we or our CROs fail to comply with GCP requirements, the clinical data generated in our clinical trials may be deemed unreliable and the FDA or comparable foreign regulatory authorities may require us to perform additional clinical trials before approving our marketing applications. We cannot assure you that upon inspection by a given regulatory authority, such

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regulatory authority will determine that any of our clinical trials comply with GCP requirements. In addition, our clinical trials must be conducted with product produced under cGMP requirements. Accordingly, if our CROs fail to comply with these requirements, we may be required to repeat clinical trials, which would delay the regulatory approval process.

        Our CROs are not our employees, and we do not control whether or not they devote sufficient time and resources to our clinical trials. Our CROs may also have relationships with other commercial entities, including our competitors, for whom they may also be conducting clinical trials, or other drug development activities, which could harm our competitive position. We face the risk of potential unauthorized disclosure or misappropriation of our intellectual property by CROs, which may reduce our trade secret protection and allow our potential competitors to access and exploit our proprietary technology. If our CROs do not successfully carry out their contractual duties or obligations, fail to meet expected deadlines, or if the quality or accuracy of the clinical data they obtain is compromised due to the failure to adhere to our clinical protocols or regulatory requirements or for any other reason, our clinical trials may be extended, delayed or terminated, and we may not be able to obtain regulatory approval for, or successfully commercialize any product candidate that we develop. As a result, our financial results and the commercial prospects for any product candidate that we develop would be harmed, our costs could increase, and our ability to generate revenue could be delayed.

        If our relationship with any CROs terminate, we may not be able to enter into arrangements with alternative CROs or do so on commercially reasonable terms. Switching or adding additional CROs involves substantial cost and requires management's time and focus. In addition, there is a natural transition period when a new CRO commences work. As a result, delays occur, which can materially impact our ability to meet our desired clinical development timelines. Though we intend to carefully manage our relationships with our CROs, there can be no assurance that we will not encounter challenges or delays in the future or that these delays or challenges will not have an adverse impact on our business, financial condition and prospects.

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the number and type of our collaborations could adversely affect our attractiveness to future collaborators or acquirers; and



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the loss of, or a disruption in our relationship with, any one or more collaborators could harm our business.

        If any collaborations do not result in the successful development and commercialization of products or if one of our collaborators terminates its agreement with us, we may not receive any future research and development funding or milestone or royalty payments under such collaborations. If we do not receive the funding we expect under these agreements, our continued development of our product candidates could be delayed, and we may need additional resources to develop additional product candidates. All of the risks relating to product development, regulatory approval and commercialization described in this prospectus also apply to the activities of any collaborators and there can be no assurance that our collaborations will produce positive results or successful products on a timely basis or at all.

        In addition, subject to its contractual obligations to us, if one of our collaborators is involved in a business combination or otherwise changes its business priorities, the collaborator might deemphasize or terminate the development or commercialization of our product candidates. If a collaborator terminates its agreement with us, we may find it more difficult to attract new collaborators and the perception of our business and our stock price could be adversely affected.

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        We may in the future collaborate with additional pharmaceutical and biotechnology companies for development and potential commercialization of therapeutic products. We face significant competition in seeking appropriate collaborators. Our ability to reach a definitive agreement for a collaboration will depend, among other things, upon our assessment of the collaborator's resources and expertise, the terms and conditions of the proposed collaboration and the proposed collaborator's evaluation of a number of factors. If we are unable to reach agreements with suitable collaborators on a timely basis, on acceptable terms, or at all, we may have to curtail the development of a product candidate, reduce or delay its development program or one or more of our other development programs, delay its potential commercialization or reduce the scope of any sales or marketing activities, or increase our expenditures and undertake development or commercialization activities at our own expense. If we elect to fund and undertake development or commercialization activities on our own, we may need to obtain additional expertise and additional capital, which may not be available to us on acceptable terms or at all. If we fail to enter into collaborations and do not have sufficient funds or expertise to undertake the necessary development and commercialization activities, we may not be able to further develop our product candidates or bring them to market or continue to develop our programs, and our business may be materially and adversely affected.

Risks Related to Healthcare Laws and Other Legal Compliance Matters

Enacted and future healthcare legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates, if approved, and may affect the prices we may set.

        In the United States and other jurisdictions, there have been, and we expect there will continue to be, a number of legislative and regulatory changes and proposed changes to the healthcare system that could affect our future results of operations. In particular, there have been and continue to be a number of initiatives at the U.S. federal and state levels that seek to reduce healthcare costs and improve the quality of healthcare. For example, in March 2010, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act, or collectively the ACA, was enacted, which substantially changed the way healthcare is financed by both governmental and private insurers. Among the provisions of the ACA, those of greatest importance to the pharmaceutical and biotechnology industries include the following:

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an annual, non-deductible fee payable by any entity that manufactures or imports certain branded prescription drugs and biologic agents (other than those designated as orphan drugs), which is apportioned among these entities according to their market share in certain government healthcare programs;



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a new Medicare Part D coverage gap discount program, in which manufacturers must agree to offer point-of-sale discounts off negotiated prices of applicable brand drugs to eligible beneficiaries during their coverage gap period, as a condition for the manufacturer's outpatient drugs to be covered under Medicare Part D;



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new requirements to report certain financial arrangements with physicians and teaching hospitals, including reporting "transfers of value" made or distributed to prescribers and other healthcare providers and reporting investment interests held by physicians and their immediate family members;



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an increase in the statutory minimum rebates a manufacturer must pay under the Medicaid Drug Rebate Program;



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a new methodology by which rebates owed by manufacturers under the Medicaid Drug Rebate Program are calculated for drugs and biologics that are inhaled, infused, instilled, implanted, or injected;

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extension of a manufacturer's Medicaid rebate liability to covered drugs dispensed to individuals who are enrolled in Medicaid managed care organizations;



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expansion of eligibility criteria for Medicaid programs thereby potentially increasing a manufacturer's Medicaid rebate liability;



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a new Patient-Centered Outcomes Research Institute to oversee, identify priorities in, and conduct comparative clinical effectiveness research, along with funding for such research;



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establishment of a Center for Medicare Innovation at the Centers for Medicare & Medicaid Services, or CMS, to test innovative payment and service delivery models to lower Medicare and Medicaid spending, potentially including prescription drug spending;



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expansion of the entities eligible for discounts under the Public Health Service program; and



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a licensure framework for follow on biologic products.

        Since its enactment, there have been judicial and Congressional challenges to certain aspects of the ACA, and we expect there will be additional challenges and amendments to the ACA in the future. The current presidential administration and Congress will likely continue to seek to modify, repeal, or otherwise invalidate all, or certain provisions of, the ACA. This includes enactment of the Tax Cuts and Jobs Act, which, among other things, removes penalties for not complying with the ACA's individual mandate to carry health insurance. It is uncertain the extent to which any such changes may impact our business or financial condition.

        Other legislative changes have been proposed and adopted in the United States since the ACA was enacted. For example, the Budget Control Act of 2011, resulted in aggregate reductions of Medicare payments to providers of 2% per fiscal year. These reductions went into effect in April 2013 and, due to subsequent legislative amendments to the statute, will remain in effect through 2027 unless additional action is taken by Congress. In January 2013, the American Taxpayer Relief Act of 2012 was signed into law, which, among other things, further reduced Medicare payments to several types of providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years. Additionally, the orphan drug tax credit was reduced as part of a broader tax reform. These new laws or any other similar laws introduced in the future may result in additional reductions in Medicare and other health care funding, which could negatively affect our customers and accordingly, our financial operations.

        In addition, there has been increasing legislative and enforcement interest in the United States with respect to specialty drug pricing practices. Specifically, there have been Congressional inquiries and proposed federal and state legislation designed to bring more transparency to drug pricing, reduce the cost of prescription drugs under Medicare, review the relationship between pricing and manufacturer patient programs and reform government program reimbursement methodologies for drugs. Moreover, payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives. We expect that additional U.S. federal healthcare reform measures will be adopted in the future, any of which could limit the amounts that the U.S. federal government will pay for healthcare products and services, which could result in reduced demand for our product candidates or additional pricing pressures.

        Individual states in the United States have also become increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access and marketing cost disclosure and transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. Legally mandated price controls on payment amounts by third-party payors or other restrictions could harm our business, results of

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operations, financial condition and prospects. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs. This could reduce the ultimate demand for our product candidates or put pressure on our product pricing.

        In markets outside of the United States, reimbursement and healthcare payment systems vary significantly by country, and many countries have instituted price ceilings on specific products and therapies. We cannot predict the likelihood, nature, or extent of government regulation that may arise from future legislation or administrative action in the United States or any other jurisdiction. If we or any third parties we may engage are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we or such third parties are not able to maintain regulatory compliance, our product candidates may lose any regulatory approval that may have been obtained and we may not achieve or sustain profitability.

Our business operations and current and future relationships with investigators, healthcare professionals, consultants, third-party payors, patient organizations, and customers will be subject to applicable healthcare regulatory laws, which could expose us to penalties.

        Our business operations and current and future arrangements with investigators, healthcare professionals, consultants, third-party payors, patient organizations, and customers, may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations. These laws may constrain the business or financial arrangements and relationships through which we conduct our operations, including how we research, market, sell and distribute our product candidates, if approved. Such laws include:

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the U.S. federal Anti-Kickback Statute, which prohibits, among other things, persons or entities from knowingly and willfully soliciting, offering, receiving, or providing any remuneration (including any kickback, bribe, or certain rebate), directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward, or in return for, either the referral of an individual for, or the purchase, lease, order, or recommendation of, any good, facility, item, or service, for which payment may be made, in whole or in part, under U.S. federal and state healthcare programs such as Medicare and Medicaid. A person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation. The U.S. federal Anti-Kickback Statute has been interpreted to apply to arrangements between pharmaceutical manufacturers on the one hand and prescribers, purchasers and formulary managers on the other hand;



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the U.S. federal false claims and civil monetary penalties laws, including the civil False Claims Act, or FCA, which, among other things, impose criminal and civil penalties, including through civil whistleblower orqui tam actions, against individuals or entities for knowingly presenting, or causing to be presented, to the U.S. federal government, claims for payment or approval that are false or fraudulent, knowingly making, using or causing to be made or used, a false record or statement material to a false or fraudulent claim, or from knowingly making a false statement to avoid, decrease or conceal an obligation to pay money to the U.S. federal government. In addition, the government may assert that a claim including items and services resulting from a violation of the U.S. federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the FCA. A claim includes "any request or demand" for money or property presented to the federal government. In addition, manufacturers can be held liable under the FCA even when they do not submit claims directly to government payors if they are deemed to "cause" the submission of false or fraudulent claims;



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the U.S. federal Health Insurance Portability and Accountability Act of 1996, or HIPAA, which imposes criminal and civil liability for, among other things, knowingly and willfully executing, or

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attempting to execute, a scheme to defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement, in connection with the delivery of, or payment for, healthcare benefits, items or services. Similar to the U.S. federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;

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HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009, or HITECH, and their respective implementing regulations, which impose, among other things, specified requirements relating to the privacy, security and transmission of individually identifiable health information without appropriate authorization by covered entities subject to the rule, such as health plans, healthcare clearinghouses and healthcare providers as well as their business associates that perform certain services involving the use or disclosure of individually identifiable health information. HITECH also created new tiers of civil monetary penalties, amended HIPAA to make civil and criminal penalties directly applicable to business associates and gave state attorneys general new authority to file civil actions for damages or injunctions in federal courts to enforce the federal HIPAA laws and seek attorneys' fees and costs associated with pursuing federal civil actions;



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the FDCA, which prohibits, among other things, the adulteration or misbranding of drugs, biologics and medical devices;



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the U.S. federal legislation commonly referred to as the Physician Payments Sunshine Act, enacted as part of the ACA, and its implementing regulations, which requires certain manufacturers of drugs, devices, biologics, and medical supplies that are reimbursable under Medicare, Medicaid, or the Children's Health Insurance Program to report annually to the government information related to certain payments and other transfers of value to physicians and teaching hospitals, as well as ownership and investment interests held by the physicians described above and their immediate family members; and



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analogous U.S. state laws and regulations, including: state anti-kickback and false claims laws, which may apply to our business practices, including but not limited to, research, distribution, sales, and marketing arrangements and claims involving healthcare items or services reimbursed by any third-party payor, including private insurers; state laws that require pharmaceutical companies to comply with the pharmaceutical industry's voluntary compliance guidelines and the relevant compliance guidance promulgated by the U.S. federal government, or otherwise restrict payments that may be made to healthcare providers and other potential referral sources; state laws and regulations that require drug manufacturers to file reports relating to pricing and marketing information, which requires tracking gifts and other remuneration and items of value provided to healthcare professionals and entities; and state laws governing the privacy and security of health information in certain circumstances, many of which differ from each other in significant ways and often are not preempted by HIPAA, thus complicating compliance efforts.

        Because of the breadth of these laws and the narrowness of the statutory exceptions and regulatory safe harbors available under such laws, it is possible that some of our business activities, including our consulting agreements and other relationships with physicians and other healthcare providers, some of whom receive stock or stock options as compensation for their services, could be subject to challenge under one or more of such laws. Ensuring that our current and future internal operations and business arrangements with third parties comply with applicable healthcare laws and regulations will involve substantial costs. It is possible that governmental authorities will conclude that our business practices

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do not comply with current or future statutes, regulations, agency guidance or case law involving applicable fraud and abuse or other healthcare laws and regulations.

        If our operations are found to be in violation of any of the laws described above or any other governmental laws and regulations that may apply to us, we may be subject to the imposition of civil, criminal and administrative penalties, damages, disgorgement, monetary fines, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, individual imprisonment, contractual damages, reputational harm, diminished profits and future earnings, additional reporting requirements or oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws, and curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business and our results of operations. If any of the physicians or other providers or entities with whom we expect to do business are found to not be in compliance with applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government funded healthcare programs and imprisonment, which could affect our ability to operate our business. Further, defending against any such actions can be costly, time-consuming and may require significant personnel resources. Therefore, even if we are successful in defending against any such actions that may be brought against us, our business may be impaired.

Any clinical trial programs we conduct or research collaborations we enter into in the European Economic Area may subject us to the General Data Protection Regulation.

        If we conduct clinical trial programs or enter into research collaborations in the European Economic Area, we may be subject to the General Data Protection regulation, or GDPR. The GDPR applies extraterritorially and implements stringent operational requirements for processors and controllers of personal data, including, for example, high standards for obtaining consent from individuals to process their personal data, robust disclosures to individuals, a comprehensive individual data rights regime, data export restrictions governing transfers of data from the European Union, or EU, to other jurisdictions, short timelines for data breach notifications, limitations on retention of information, increased requirements pertaining to health data, other special categories of personal data and coded data and additional obligations if we contract third-party processors in connection with the processing of personal data. The GDPR provides that EU member states may establish their own laws and regulations limiting the processing of personal data, including genetic, biometric or health data, which could limit our ability to use and share personal data or could cause our costs to increase. If our or our partners' or service providers' privacy or data security measures fail to comply with the GDPR requirements, we may be subject to litigation, regulatory investigations, enforcement notices requiring us to change the way we use personal data and/or fines of up to 20 million Euros or up to 4% of the total worldwide annual turnover of the preceding financial year, whichever is higher, as well as compensation claims by affected individuals, negative publicity, reputational harm and a potential loss of business and goodwill.

We are subject to environmental, health and safety laws and regulations, and we may become exposed to liability and substantial expenses in connection with environmental compliance or remediation activities.

        Our operations, including our development, testing and manufacturing activities, are subject to numerous environmental, health and safety laws and regulations. These laws and regulations govern, among other things, the controlled use, handling, release and disposal of and the maintenance of a registry for, hazardous materials and biological materials, such as chemical solvents, human cells, carcinogenic compounds, mutagenic compounds and compounds that have a toxic effect on reproduction, laboratory procedures and exposure to blood-borne pathogens. If we fail to comply with such laws and regulations, we could be subject to fines or other sanctions.

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        As with other companies engaged in activities similar to ours, we face a risk of environmental liability inherent in our current and historical activities, including liability relating to releases of or exposure to hazardous or biological materials. Environmental, health and safety laws and regulations are becoming more stringent. We may be required to incur substantial expenses in connection with future environmental compliance or remediation activities, in which case, the production efforts of our third-party manufacturers or our development efforts may be interrupted or delayed.

Recent U.S. tax legislation may materially adversely affect our financial condition, results of operations and cash flows.

        Recently-enacted U.S. tax legislation has significantly changed the U.S. federal income taxation of U.S. corporations, including by reducing the U.S. corporate income tax rate, limiting interest deductions, and revising the rules governing NOLs. Many of these changes are effective immediately, without any transition periods or grandfathering for existing transactions. The legislation is unclear in many respects and could be subject to potential amendments and technical corrections, as well as interpretations and implementing regulations by the Treasury and Internal Revenue Service, or the IRS, any of which could lessen or increase certain adverse impacts of the legislation. In addition, it is unclear how these U.S. federal income tax changes will affect state and local taxation, which often uses federal taxable income as a starting point for computing state and local tax liabilities.

        The reduction of the corporate tax rate under the legislation may cause a reduction in the economic benefit of our NOLs and other deferred tax assets available to us. Furthermore, under the legislation, although the treatment of tax losses generated before December 31, 2017 has generally not changed, tax losses generated in calendar year 2018 and beyond will only be able to offset 80% of taxable income. This change may require us to pay federal income taxes in future years despite generating a loss for federal income tax purposes in prior years.

        While some of the changes made by the tax legislation may adversely affect us in one or more reporting periods and prospectively, other changes may be beneficial on a going-forward basis. We intend to work with our tax advisors and auditors to determine the full impact that the recent tax legislation as a whole will have on us. We urge our investors to consult with their legal and tax advisors with respect to such legislation.

Risks Related to Our Intellectual Property

If we fail to comply with our obligations under our existing intellectual property license, we risk losing the rights to the seminal composition of matter patent.

        We rely upon patents and proprietary technology, currently co-owned by a subsidiary of Horizon Therapeutics, PLC and the U.S. Public Health Service (PHS) to develop ANVS-401. We have an exclusive worldwide license, subject to standard reservation of rights under federal law, to ANVS-401 for its composition of matter, its use in AD and dementia, its manufacture and its use in Down syndrome, which allows us to develop and commercialize ANVS-401 for those indications. The agreement allows us to either pay license fees and royalties on sales to develop and sell ANVS-401 or to exercise an option to buy the rights out and own the rights to the compound outright. If we do not fulfill the terms of the license, Horizon may offer these patents to other parties and we will lose the right to develop and commercialize ANVS-401. If we do not exercise our option to buy the rights out or our right to terminate the agreement, the term of the agreement will continue until the expiration of our obligation to make royalty payments. Such royalty payments continue for each product in each country until the later of the expiration of the related patent or 10 years after the initial sale of the product in the respective country. The agreement may also be terminated for cause by either party upon the breach of the material obligations of the other party or the bankruptcy or liquidation of the other party.

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If we are unable to maintain patent protection for our technology licensed from Horizon or if the scope of the patent protection obtained is not sufficiently broad, we may not be able to compete effectively in our markets.

        We rely upon a combination of patents, trade secret protection and confidentiality agreements to protect the intellectual property related to our drug development programs and product candidates. Our success depends in large part on our ability to obtain, maintain and maintaindefend patent protection in the United States and other countries with respect to ANVS-401 and any future product candidates. The patent prosecution process is expensive and time-consuming, and we may not be able to file and prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner. The world-wide exclusive license we have with Horizon comprises the patents co-owned by Horizon and the PHS. The patents have expiration dates between 2021 and 2026.

If we are unable to obtain additional patent protection for the applications filed by Annovis to prolong the patent life of our compounds, we may not be able to continue development of our compounds.

        We seek to protect and prolong our proprietary position by filing patent applications in the United States and abroad related to our development programs and product candidates. If the patent applications we own with respect to our development programs and product candidates fail to issue, if their breadth or strength of protection is threatened, or if they fail to provide meaningful exclusivity for ANVS-401 or any future product candidate, it could dissuade companies from collaborating with us to develop product candidates, and threaten our ability to commercialize future product candidates. Any such outcome could have a materially adverse effect on our business and our company could cease to exist.

        Annovis has filed three classesfamilies of patent applications to prolong the patent life of ANVS-401. Unless these applications are approved by the U.S. and international patent offices, the patent life of using ANVS-401 is limited. The first patent application family we filed, which has an expiration date ofwould be expected to expire in 2031, covers the use of ANVS-401 at much lower doses and expands its use to the treatment of AD, PD and other neurodegenerative disorders such as Huntington's disease, prion diseases, amyotrophic lateral sclerosis, tauopathies and frontotemporal dementia, based on our preclinical research. In JuneAugust 2019, we received a Notice of Allowance from the U.S. Patent and Trademark Office forgranted Patent No. US 10,383,851, the first of our Annovis patents from this family covering Parkinson's disease and associatedLewy body diseases. The second patent application family covers ANVS-405's use in acute brain and nerve trauma and expireswould be expected to expire in 2036.2036, before any patent term adjustments or extensions. The third patent application family coversrelates to the use of the mechanism of action of ANVS-401 and ANVS-405 to prevent and treat neurodegenerative diseases and expireswould be expected to expire in 2038.2038, before any patent term adjustments or extensions.

        While the Noticeissuance of Allowanceour new patent gives us some comfort that the patent life relating to methods of using ANVS-401 may be prolonged to 2031, the fact that only a portion of the family claims has so far been allowed could result in very limited patent coverage as the patent claims issued thus far are limited to treating PD and the limitation of our development efforts to PD alone.Lewy body diseases. It is possible that we will fail to identify further patentable aspects of our research and development output before it is too late to obtain patent protection. The patent applications that we own may fail to result in issued patents with claims that provide further coverage of ANVS-401 or any other product candidate in the United States or in other foreign countries.

Our patents may be challenged in courts or in patent offices which could result in the invalidation, narrowing or unenforceability of our patents and our patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.

        There is no assurance that all the potentially relevant prior art relating to our patents and patent applications has been found, which can invalidate a patent or prevent a patent from issuing from a

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pending patent application. Even if patents do successfully issue and even if such patents further cover ANVS-401 or any future product candidate, third parties may challenge their validity, enforceability or scope, which may result in such patents being narrowed, invalidated, or held unenforceable. Any

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successful opposition to these patents or any other patents owned by or licensed to us could deprive us of rights necessary for the successful commercialization of any product candidates that we may develop. Further, if we encounter delays in regulatory approvals, the period during which we could market a product candidate under patent protection could be reduced.

        The patent position of biotechnology and pharmaceutical companies generally is highly uncertain, involves complex legal and factual questions and has in recent years been the subject of much litigation. In addition, the laws of foreign countries may not protect our rights to the same extent as the laws of the United States. For example, European patent law restricts the patentability of methods of treatment of the human body more than U.S. law does. However, in certain instances, the laws of the United States are more restrictive than those of foreign countries. For example, a recent series of Supreme Court Cases has narrowed the types of subject matter considered eligible for patenting. Accordingly, certain diagnostic methods are considered ineligible for patenting because they are directed to a "law of nature." Further, publications of discoveries in scientific literature often lag the actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until 18 months after filing, or in some cases not at all. Therefore, we cannot know with certainty whether we were the first to make the inventions claimed in our owned or licensed patents or pending patent applications, or that we were the first to file for patent protection of such inventions. As a result, the issuance, scope, validity, enforceability and commercial value of our patent rights are highly uncertain. Our pending and future patent applications may not result in patents being issued which protect our technology or products, in whole or in part, or which effectively prevent others from commercializing competitive technologies and products. Changes in either the patent laws or interpretation of the patent laws in the United States and other countries may diminish the value of our patents or narrow the scope of our patent protection.

        The issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and our owned and licensed patents may be challenged in the courts or patent offices in the United States and abroad. Such challenges may result in patent claims being narrowed, invalidated, held unenforceable, in whole or in part, or reduced in term. Such a result could limit our ability to stop others from using or commercializing similar or identical technology and products. Moreover, patents have a limited lifespan. In the United States, the natural expiration of a patent is generally 20 years after it is filed. While various extensions may be available, the life of a patent is limited. Without patent protection for our current or future product candidates, we may be open to competition from generic versions of such products. Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized. As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.

We may become subject to third parties' claims alleging infringement of their patents and proprietary rights, or we may need to become involved in lawsuits to protect or enforce our patents, which could be costly, time consuming, delay or prevent the development and commercialization of our product candidates or put our patents and other proprietary rights at risk.

        Our commercial success depends, in part, upon our ability to develop, manufacture, market and sell our product candidates without alleged or actual infringement, misappropriation or other violation of the patents and proprietary rights of third parties. Litigation relating to infringement or misappropriation of patent and other intellectual property rights in the pharmaceutical and biotechnology industries is common, including patent infringement lawsuits, interferences, oppositions

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and reexamination proceedings before the U.S. Patent and Trademark Office, or USPTO, and corresponding foreign patent offices. The various markets in which we plan to operate are subject to frequent and extensive litigation regarding patents and other intellectual property rights. In addition,

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many companies in intellectual property-dependent industries, including the biotechnology and pharmaceutical industries, have employed intellectual property litigation as a means to gain an advantage over their competitors. Numerous U.S., EU and foreign issued patents and pending patent applications, which are owned by third parties, exist in the fields in which we are developing product candidates. Some claimants may have substantially greater resources than we do and may be able to sustain the costs of complex intellectual property litigation to a greater degree and for longer periods of time than we could. In addition, patent holding companies that focus solely on extracting royalties and settlements by enforcing patent rights may target us. As the biotechnology and pharmaceutical industries expand and more patents are issued, the risk increases that our product candidates may be subject to claims of infringement of the intellectual property rights of third parties.

        We may be subject to third-party claims including infringement, interference or derivation proceedings, post-grant review andinter partes review before the USPTO or similar adversarial proceedings or litigation in other jurisdictions. Even if we believe suchthird party infringement claims are without merit, a court of competent jurisdiction could hold that these third-party patents are valid, enforceable and infringed, and the holders of any such patents may be able to block our ability to commercialize the applicable product candidate unless we obtained a license under the applicable patents, or until such patents expire or are finally determined to be invalid or unenforceable. These proceedingsProceedings challenging our patents or those that we license may also result in our patent claims being invalidated or narrowed in scope. Similarly, if our patents or patent applications are challenged during interference or derivation proceedings, a court may hold that a third-party is entitled to certain patent ownership rights instead of us. Further, if any third-party patents were held by a court of competent jurisdiction to cover aspects of our compositions, formulations, methods of manufacture, or methods of treatment, prevention or use, the holders of any such patents may be able to block our ability to develop and commercialize the applicable product candidate unless we obtained a license or until such patent expires or is finally determined to be invalid or unenforceable. In addition, defending such claims would cause us to incur substantial expenses and, if successful, could cause us to pay substantial damages, if we are found to be infringing a third party's patent rights. If we are found to have infringed such rights willfully, the damages may be enhanced and may include attorneys' fees. Further, if a patent infringement suit is brought against us or our third-party service providers, our development, manufacturing or sales activities relating to the product or product candidate that is the subject of the suit may be delayed or terminated. As a result of patent infringement claims, or in order to avoid potential infringement claims, we may choose to seek, or be required to seek, a license from the third party, which may require us to pay license fees or royalties or both. These licenses may not be available on acceptable terms, or at all. Even if a license can be obtained on acceptable terms, the rights may be nonexclusive, which could give our competitors access to the same intellectual property rights. If we are unable to enter into a license on acceptable terms, we could be prevented from commercializing one or more of our product candidates, forced to modify such product candidates, or to cease some aspect of our business operations, which could harm our business significantly. Modifying our product candidates to design around third-party intellectual property rights may result in significant cost or delay to us and could prove to be technically infeasible. Any of these events, even if we were ultimately to prevail, could require us to divert substantial financial and management resources that we would otherwise be able to devote to our business. In addition, if the breadth or strength of protection provided the patents and patent applications we own or in-license is threatened, it could dissuade companies from collaborating with us to license, develop or commercialize current or future product candidates.

        If we were to initiate legal proceedings against a third party to enforce a patent covering one of our product candidates, the defendant could counterclaim that our patent is invalid or unenforceable. In patent litigation in the United States and in Europe, defendant counterclaims alleging invalidity or

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unenforceability are commonplace. Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, for example, lack of eligibility, lack of novelty, obviousness or non-enablement. Third parties might allege unenforceability of our patents because someone connected

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with prosecution of the patent withheld relevant information, or made a misleading statement, during prosecution. The outcome of proceedings involving assertions of invalidity and unenforceability during patent litigation is unpredictable. With respect to the validity of patents, for example, we cannot be certain that there is no invalidating prior art of which we and the patent examiner were unaware during prosecution. If a defendant were to prevail on a legal assertion of invalidity or unenforceability, we would lose at least part, and perhaps all, of the patent protection on our product candidates. Furthermore, our patents and other intellectual property rights also will not protect our technology if competitors design around our protected technology without infringing on our patents or other intellectual property rights.

        Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. There could also be public announcements of the results of hearings, motions or other interim proceedings or developments. If securities analysts or investors view these announcements in a negative light, the price of our common stock could be adversely affected.

        Finally, even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses and could distract our technical and management personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors view these announcements in a negative light, the price of our common stock could be adversely affected. Such litigation or proceedings could substantially increase our operating losses and reduce our resources available for development activities. We may not have sufficient financial or other resources to adequately conduct such litigation or proceedings. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their substantially greater financial resources. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could have an adverse effect on our ability to compete in the marketplace.

We may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of a third-party patent, which might adversely affect our ability to develop, manufacture and market our product candidates.

        We cannot guarantee that any of our or our licensors' patent searches or analyses, including but not limited to the identification of relevant patents, the scope of patent claims or the expiration of relevant patents, are complete or thorough, nor can we be certain that we have identified each and every third-party patent and pending application in the United States, Europe and elsewhere that is relevant to or necessary for the commercialization of our product candidates in any jurisdiction. For example, in the United States, applications filed before November 29, 2000 and certain applications filed after that date that will not be filed outside the United States remain confidential until patents issue. Patent applications in the United States, EU and elsewhere are published approximately 18 months after the earliest filing for which priority is claimed, with such earliest filing date being commonly referred to as the priority date. Therefore, patent applications covering our future product candidates, or their manufacture or use may currently be unpublished. Additionally, pending patent applications that have been published can, subject to certain limitations, be later amended in a manner that could cover our product candidates or the use of our product candidates. The scope of a patent claim is determined by an interpretation of the law, the written disclosure in a patent and the patent's prosecution history. Our interpretation of the relevance or the scope of a patent or a pending

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application may be incorrect, which may negatively impact our ability to market our product candidates. We may incorrectly determine that our product candidates are not covered by a third-party patent or may incorrectly predict whether a third party's pending application will issue with claims of relevant

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scope. Our determination of the expiration date of any patent in the United States, the EU or elsewhere that we consider relevant may be incorrect, which may negatively impact our ability to develop and market our product candidates. Our failure to identify and correctly interpret relevant patents may negatively impact our ability to develop and market our product candidates.

        From time to time we may identify patents or applications in the same general area as our products and product candidates. We may determine these third-party patents are irrelevant to our business based on various factors including our interpretation of the scope of the patent claims and our interpretation of when the patent expires. If the patents are asserted against us, however, a court may disagree with our determinations. Further, while we may determine that the scope of claims that will issue from a patent application does not present a risk, it is difficult to accurately predict the scope of claims that will issue from a patent application, our determination may be incorrect, and the issuing patent may be asserted against us. We cannot guarantee that we will be able to successfully settle or otherwise resolve such infringement claims. If we fail in any such dispute, in addition to being forced to pay monetary damages, we may be temporarily or permanently prohibited from commercializing our product candidates. We might, if possible, also be forced to redesign our product candidates so that we no longer infringe on the third-party intellectual property rights. Any of these events, even if we were ultimately to prevail, could require us to divert substantial financial and management resources that we would otherwise be able to devote to our business.

Changes in patent laws or patent jurisprudence could diminish the value of patents in general, thereby impairing our ability to protect our product candidates.

        As is the case with other biopharmaceutical and pharmaceutical companies, our success is heavily dependent on intellectual property, particularly patents. Obtaining and enforcing patents in the biopharmaceutical and pharmaceutical industries involve both technological complexity and legal complexity. Therefore, obtaining and enforcing biopharmaceutical and pharmaceutical patents is costly, time-consuming and inherently uncertain. In addition, the America Invents Act (AIA) which was passed in September 2011, resulted in significant changes to the U.S. patent system.

        An important change introduced by the AIA is that, as of March 16, 2013, the United States transitioned to a "first-to-file" system for deciding which party should be granted a patent when two or more patent applications are filed by different parties claiming the same invention. A third party that files a patent application in the USPTO after that date but before us could therefore be awarded a patent covering an invention of ours even if we made the invention before it was made by the third party. This will require us to be cognizant going forward of the time from invention to filing of a patent application, but circumstances could prevent us from promptly filing patent applications on our inventions.

        Among some of the other changes introduced by the AIA are changes that limit where a patentee may file a patent infringement suit and provide opportunities for third parties to challenge any issued patent with the USPTO. This applies to all of our U.S. patents, even those issued before March 16, 2013. Because of a lower evidentiary standard in USPTO proceedings compared to the evidentiary standard in U.S. federal courts necessary to invalidate a patent claim, a third party could potentially provide evidence in a USPTO proceeding sufficient for the USPTO to hold a claim invalid even though the same evidence would be insufficient to invalidate the claim if first presented in a district court action.

        Accordingly, a third party may attempt to use the USPTO procedures to invalidate our patent claims that would not have been invalidated if first challenged by the third party as a defendant in a district court action. It is not clear what, if any, impact the AIA will have on the operation of our business. However, the AIA and its implementation could increase the uncertainties and costs surrounding the prosecution of our or our licensors' patent applications and the enforcement or defense of our or our licensors' issued patents.

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        Additionally, the U.S. Supreme Court has ruled on several patent cases in recent years either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations. In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained. Depending on decisions by Congress, the federal courts and the USPTO, the laws and regulations governing patents could change in unpredictable ways that could weaken our ability to obtain new patents or to enforce our existing patents and patents that we might obtain in the future. Similarly, the complexity and uncertainty of European patent laws has also increased in recent years. In addition, the European patent system is relatively stringent in the type of amendments that are allowed during prosecution. Complying with these laws and regulations could limit our ability to obtain new patents in the future that may be important for our business.

Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.

        Periodic maintenance and annuity fees on any issued patent are due to be paid to the USPTO and European and other patent agencies over the lifetime of a patent. In addition, the USPTO and European and other patent agencies require compliance with a number of procedural, documentary, fee payment and other similar provisions during the patent application process. While an inadvertent failure to make payment of such fees or to comply with such provisions can in many cases be cured by payment of a late fee or by other means in accordance with the applicable rules, there are situations in which such noncompliance will result in the abandonment or lapse of the patent or patent application, and the partial or complete loss of patent rights in the relevant jurisdiction. Non-compliance events that could result in abandonment or lapse of a patent or patent application include failure to respond to official actions within prescribed time limits, non-payment of fees and failure to properly legalize and submit formal documents within prescribed time limits. If we or our licensors fail to maintain the patents and patent applications covering our product candidates or if we or our licensors otherwise allow our patents or patent applications to be abandoned or lapse, our competitors might be able to enter the market, which would hurt our competitive position and could impair our ability to successfully commercialize our product candidates in any indication for which they are approved.

We enjoy only limited geographical protection with respect to certain patents and we may not be able to protect our intellectual property rights throughout the world.

        Filing, prosecuting and defending patents covering our product candidates in all countries throughout the world would be prohibitively expensive. Competitors may use our and our licensors' technologies in jurisdictions where we have not obtained patent protection to develop their own products and, further, may export otherwise infringing products to territories where we and our licensors have patent protection, but enforcement is not as strong as that in the United States or the EU. These products may compete with our product candidates, and our and our licensors' patents or other intellectual property rights may not be effective or sufficient to prevent them from competing.

        In addition, we may decide to abandon national and regional patent applications before grant. The grant proceeding of each national or regional patent is an independent proceeding which may lead to situations in which applications might in some jurisdictions be refused by the relevant patent offices, while granted by others. For example, unlike other countries, China has a heightened requirement for patentability, and specifically requires a detailed description of medical uses of a claimed drug. Furthermore, generic drug manufacturers or other competitors may challenge the scope, validity or enforceability of our or our licensors' patents, requiring us or our licensors to engage in complex, lengthy and costly litigation or other proceedings. Generic drug manufacturers may develop, seek

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approval for and launch generic versions of our products. It is also quite common that depending on the country, the scope of patent protection may vary for the same product candidate or technology.

        The laws of some jurisdictions do not protect intellectual property rights to the same extent as the laws or rules and regulations in the United States and the EU, and many companies have encountered significant difficulties in protecting and defending such rights in such jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets and other intellectual property protection, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our proprietary rights generally. Proceedings to enforce our patent rights in other jurisdictions, whether or not successful, could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our patents at risk of being invalidated or interpreted narrowly and our patent applications at risk of not issuing, and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate, and the damages or other remedies awarded, if any, may not be commercially meaningful. Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license. Furthermore, while we intend to protect our intellectual property rights in our expected significant markets, we cannot ensure that we will be able to initiate or maintain similar efforts in all jurisdictions in which we may wish to market our product candidates. Accordingly, our efforts to protect our intellectual property rights in such countries may be inadequate, which may have an adverse effect on our ability to successfully commercialize our product candidates in all of our expected significant foreign markets. If we or our licensors encounter difficulties in protecting, or are otherwise precluded from effectively protecting, the intellectual property rights important for our business in such jurisdictions, the value of these rights may be diminished, and we may face additional competition from others in those jurisdictions.

        Some countries also have compulsory licensing laws under which a patent owner may be compelled to grant licenses to third parties. In addition, some countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of such patent. If we or any of our licensors is forced to grant a license to third parties with respect to any patents relevant to our business, our competitive position may be impaired.

If we do not obtain patent term extension in the United States under the Hatch-Waxman Act and in foreign countries under similar legislation, thereby potentially extending the term of marketing exclusivity for our product candidates, our business may be materially harmed.

        Patents have a limited lifespan. In the United States, if all maintenance fees are timely paid, the natural expiration of a patent is generally 20 years from its earliest U.S. non-provisional filing date. Various extensions may be available, but the life of a patent, and the protection it affords, is limited. Even if patents covering our product candidates are obtained, once the patent life has expired for a product, we may be open to competition from competitive medications, including generic medications. Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized. As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours.

        Depending upon the timing, duration and conditions of FDA marketing approval of our product candidates, we may be able to extend the term of a patent covering each product candidate under the Drug Price Competition and Patent Term Restoration Act of 1984, referred to as the Hatch-Waxman Amendments and similar legislation in the EU. The Hatch-Waxman Amendments permit a patent term extension of up to five years for a patent covering an approved product as compensation for effective patent term lost during product development and the FDA regulatory review process. However, we mayThe total patent

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term including the extension cannot exceed 14 years following regulatory approval. However, we may not receive an extension if we fail to apply within applicable deadlines, fail to apply prior to expiration of relevant patents or otherwise fail to satisfy applicable requirements. Moreover, the length of the extension could be less than we request. If we are unable to obtain patent term extension or the term of any such extension is less than we request, the period during which we can enforce our patent rights for that product will be shortened and our competitors may obtain approval to market competing products sooner. As a result, our revenue from applicable products could be reduced, possibly materially.

        Further, under certain circumstances, patent terms covering our products or product candidates may be extended for time spent during the pendency of the patent application in the USPTO (referred to as Patent Term Adjustment, or PTA). The laws and regulations underlying how the USPTO calculates the PTA is subject to change and any such PTA granted by the USPTO could be challenged by a third-party. If we do not prevail under such a challenge, the PTA may be reduced or eliminated, resulting in a shorter patent term, which may negatively impact our ability to exclude competitors. Because PTA added to the term of patents covering pharmaceutical products has particular value, our business may be adversely affected if the PTA is successfully challenged by a third party and our ability to exclude competitors is reduced or eliminated.

Intellectual property rights do not address all potential threats to our competitive advantage.

        The degree of future protection afforded by our intellectual property rights is uncertain because intellectual property rights have limitations, and may not adequately protect our business, or permit us to maintain our competitive advantage. The following examples are illustrative:

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others may be able to make products that are similar to ANVS-401 or our future product candidates but that are not covered by the claims of the patents that we own or license from others;



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others may independently develop similar or alternative technologies or otherwise circumvent any of our technologies without infringing our intellectual property rights;



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we or any of our collaborators might not have been the first to conceive and reduce to practice the inventions covered by the patents or patent applications that we own, license or will own or license;



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we or any of our collaborators might not have been the first to file patent applications covering certain of the patents or patent applications that we or they own or have obtained a license, or will own or will have obtained a license;



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it is possible that our pending patent applications will not lead to issued patents;



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issued patents that we own may not provide us with any competitive advantage, or may be held invalid or unenforceable, as a result of legal challenges by our competitors;



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our competitors might conduct research and development activities in countries where we do not have patent rights, or in countries where research and development safe harbor laws exist, and then use the information learned from such activities to develop competitive products for sale in our major commercial markets;



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ownership of our patents or patent applications may be challenged by third parties; and



•

the patents of third parties or pending or future applications of third parties, if issued, may have an adverse effect on our business.

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Our reliance on third parties requires us to share our trade secrets, which increases the possibility that our trade secrets will be misappropriated or disclosed, and confidentiality agreements with employees and third parties may not adequately prevent disclosure of trade secrets and protect other proprietary information.

        We consider proprietary trade secrets or confidential know-how and unpatented know-how to be important to our business. We may rely on trade secrets or confidential know-how to protect our technology, especially where patent protection is believed by us to be of limited value. Because we expect to rely on third parties to manufacture ANVS-401 and any future product candidates, and we expect to collaborate with third parties on the development of ANVS-401 and any future product candidates, we must, at times, share trade secrets with them. We also conduct joint research and development programs that may require us to share trade secrets under the terms of our research and development partnerships or similar agreements. However, trade secrets or confidential know-how can be difficult to maintain as confidential.

        To protect this type of information against disclosure or appropriation by competitors, our policy is to require our employees, consultants, contractors and advisors to enter into confidentiality agreements and, if applicable, material transfer agreements, consulting agreements or other similar agreements with us prior to beginning research or disclosing proprietary information. These agreements typically limit the rights of the third parties to use or disclose our confidential information, including our trade secrets. However, current or former employees, consultants, contractors and advisers may unintentionally or willfully disclose our confidential information to competitors, and confidentiality agreements may not provide an adequate remedy in the event of unauthorized disclosure of confidential information. The need to share trade secrets and other confidential information increases the risk that such trade secrets become known by our competitors, are inadvertently incorporated into the technology of others, or are disclosed or used in violation of these agreements. Given that our proprietary position is based, in part, on our know-how and trade secrets, a competitor's discovery of our trade secrets or other unauthorized use or disclosure would impair our competitive position and may have an adverse effect on our business and results of operations. Enforcing a claim that a third party obtained illegally and is using trade secrets or confidential know-how is expensive, time consuming and unpredictable. The enforceability of confidentiality agreements may vary from jurisdiction to jurisdiction.

        In addition, these agreements typically restrict the ability of our advisors, employees, third-party contractors and consultants to publish data potentially relating to our trade secrets, although our agreements may contain certain limited publication rights. Despite our efforts to protect our trade secrets, our competitors may discover our trade secrets, either through breach of our agreements with third parties, independent development or publication of information by any of our third-party collaborators. A competitor's discovery of our trade secrets would impair our competitive position and have an adverse impact on our business.

If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected.

        Our unregistered trademarks or trade names may be challenged, infringed, circumvented or declared generic or determined to be infringing on other marks. We may not be able to protect our rights to these trademarks and trade names, which we need to build name recognition among potential collaborators or customers in our markets of interest. At times, competitors may adopt trade names or trademarks similar to ours, thereby impeding our ability to build brand identity and possibly leading to market confusion. In addition, there could be potential trade name or trademark infringement claims brought by owners of other registered trademarks or trademarks that incorporate variations of our unregistered trademarks or trade names. Over the long term, if we are unable to successfully register our trademarks and trade names and establish name recognition based on our trademarks and trade names, then we may not be able to compete effectively, and our business may be adversely affected.

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Our efforts to enforce or protect our proprietary rights related to trademarks, trade secrets, domain names, copyrights or other intellectual property may be ineffective and could result in substantial costs and diversion of resources and could adversely impact our financial condition or results of operations.

We may need to license certain intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms.

        A third party may hold intellectual property, including patent rights that are important or necessary to the development or commercialization of ANVS-401 or our future product candidates. It may be necessary for us to use the patented or proprietary technology of third parties to commercialize ANVS-401 or our product candidates, in which case we would be required to obtain a license from these third parties. Such a license may not be available on commercially reasonable terms, or at all, which could materially harm our business. At this time, we are unaware of any intellectual property that interferes with ours or is complementary and needed to commercialize ANVS-401.

We may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed confidential information of their former employers or other third parties.

        We employ individuals who were previously employed at other biotechnology or pharmaceutical companies. Although we seek to protect our ownership of intellectual property rights by ensuring that our agreements with our employees, collaborators and other third parties with whom we do business include provisions requiring such parties to assign rights in inventions to us, we may be subject to claims that we or our employees, consultants or independent contractors have inadvertently or otherwise used or disclosed confidential information of our employees' former employers or other third parties. We may also be subject to claims that former employers or other third parties have an ownership interest in our patents. Litigation may be necessary to defend against these claims. There is no guarantee of success in defending these claims, and if we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights, such as exclusive ownership or right to use. Even if we are successful, litigation could result in substantial cost and be a distraction to our management and other employees.

Our proprietary information may be lost, or we may suffer security breaches.

        In the ordinary course of our business, we collect and store sensitive data, including intellectual property, clinical trial data, proprietary business information, personal data and personally identifiable information of our clinical trial subjects and employees, in our data centers and on our networks. The secure processing, maintenance and transmission of this information is critical to our operations. Despite our security measures, our information technology and infrastructure may be vulnerable to attacks by hackers or breached due to employee error, malfeasance or other disruptions. Although, to our knowledge, we have not experienced any such material security breach to date, any such breach could compromise our networks and the information stored there could be accessed, publicly disclosed, lost or stolen. Any such access, disclosure or other loss of information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, significant regulatory penalties, disruption of our operations, damage to our reputation and cause a loss of confidence in us and our ability to conduct clinical trials, which could adversely affect our reputation and delay our clinical development of our product candidates.

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Risks Related to Our Employees, Managing Our Growth and Our Operations

Our future success depends on our ability to retain our key personnel and to attract, retain and motivate qualified personnel.

        We are highly dependent on the development, regulatory, commercialization and business development expertise of Maria L. Maccecchini, PhD, as well as the other principal members of our management, scientific and clinical teams. Although we have employment agreements, offer letters or consulting agreements with our executive officers, these agreements do not prevent them from terminating their services at any time.

        If we lose one or more of our executive officers or key employees, our ability to implement our business strategy successfully could be seriously harmed. Furthermore, replacing executive officers and key employees may be difficult and may take an extended period of time because of the limited number of individuals in our industry with the breadth of skills and experience required to successfully develop product candidates, gain regulatory approval, and commercialize new products. Competition to hire from this limited pool is intense, and we may be unable to hire, train, retain or motivate these additional key personnel on acceptable terms given the competition among numerous pharmaceutical and biotechnology companies for similar personnel. We also experience competition for the hiring of scientific and clinical personnel from universities and research institutions. In addition, we rely on consultants and advisors, including scientific and clinical advisors, to assist us in formulating our research and development and commercialization strategy. Our consultants and advisors may be engaged by entities other than us and may have commitments under consulting or advisory contracts with other entities that may limit their availability to us. If we are unable to continue to attract and retain highly qualified personnel, our ability to develop and commercialize product candidates will be limited.

We expect to expand our development, regulatory, and sales and marketing capabilities, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations.

        We expect to experience significant growth in the number of our employees and the scope of our operations, particularly in the areas of development, regulatory affairs and sales and marketing. To manage our anticipated future growth, we must continue to implement and improve our managerial, operational and financial systems, expand our facilities or acquire new facilities and continue to recruit and train additional qualified personnel. Due to our limited financial resources and the limited experience of our management team in managing a company with such anticipated growth, we may not be able to effectively manage the expansion of our operations or recruit and train additional qualified personnel. The expansion of our operations may lead to significant costs and may divert our management and business development resources. Any inability to manage growth could delay the execution of our business plans or disrupt our operations.

We may engage in acquisitions that could disrupt our business, cause dilution to our stockholders or reduce our financial resources.

        In the future, we may enter into transactions to acquire other businesses, products or technologies. If we do identify suitable candidates, we may not be able to make such acquisitions on favorable terms, or at all. Any acquisitions we make may not strengthen our competitive position, and these transactions may be viewed negatively by customers or investors. We may decide to incur debt in connection with an acquisition or issue our common stock or other equity securities to the stockholders of the acquired company, which would reduce the percentage ownership of our existing stockholders. We could incur losses resulting from undiscovered liabilities of the acquired business that are not covered by the indemnification we may obtain from the seller. In addition, we may not be able to successfully integrate the acquired personnel, technologies and operations into our existing business in an effective, timely

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and nondisruptive manner. Acquisitions may also divert management attention from day-to-day responsibilities, increase our expenses and reduce our cash available for operations and other uses. We cannot predict the number, timing or size of future acquisitions or the effect that any such transactions might have on our operating results.

Our business and operations would suffer in the event of system failures.

        Our computer systems, as well as those of our CROs and other contractors and consultants, are vulnerable to damage from computer viruses, unauthorized access, natural disasters (including hurricanes), terrorism, war and telecommunication and electrical failures. If such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our development programs. For example, the loss of preclinical or clinical trial data from completed, ongoing or planned trials could result in delays in our regulatory approval efforts and significantly increase our costs to recover or reproduce the data. To the extent that any disruption or security breach were to result in a loss of or damage to our data or applications, or inappropriate disclosure of personal, confidential or proprietary information, we could incur liability and the further development of ANVS-401 or any other product candidate could be delayed.

Risks Related to this Offering and Our Common Stock

No active trading market for our common stock currently exists, and an active trading market may not develop.

        Prior to this offering, there has not been an active trading market for our common stock. If an active trading market for our common stock does not develop following this offering, you may not be able to sell your shares quickly or at the market price. Our ability to raise capital to continue to fund operations by selling shares of our common stock and our ability to acquire other companies or technologies by using shares of our common stock as consideration may also be impaired. The initial public offering price of our common stock will be determined by negotiations between us and the underwriters and may not be indicative of the market prices of our common stock that will prevail in the trading market.

The market price of our common stock may be volatile and fluctuate substantially, which could result in substantial losses for purchasers of our common stock in this offering.

        The market price of our common stock is likely to be highly volatile and may be subject to wide fluctuations in response to a variety of factors, including the following:

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any delay in the commencement, enrollment and ultimate completion of our Phase 2a trials of ANVS-401;



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if we are required to conduct more than one Phase 3 trial in any one indication;



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any delay in submitting an NDA and any adverse development or perceived adverse development with respect to the FDA's review of that NDA;



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failure to successfully develop and commercialize ANVS-401 or any future product candidate;



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inability to obtain additional funding;



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regulatory or legal developments in the United States and other countries applicable to ANVS-401 or any other product candidate;



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adverse regulatory decisions;



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changes in the structure of healthcare payment systems;

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inability to obtain adequate product supply for ANVS-401 or any other product candidate, or the inability to do so at acceptable prices;



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introduction of new products, services or technologies by our competitors;



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failure to meet or exceed financial projections we provide to the public;



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failure to meet or exceed the estimates and projections of the investment community;



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changes in the market valuations of companies similar to ours;



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market conditions in the pharmaceutical and biotechnology sectors, and the issuance of new or changed securities analysts' reports or recommendations;



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announcements of significant acquisitions, strategic collaborations, joint ventures or capital commitments by us or our competitors;



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significant lawsuits, including patent or shareholder litigation, and disputes or other developments relating to our proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our technologies;



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additions or departures of key scientific or management personnel;



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sales of our common stock by us or our shareholders in the future;



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trading volume of our common stock;



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general economic, industry and market conditions; and



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the other factors described in this "Risk Factors" section.

        In addition, the stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies. These fluctuations have often been unrelated or disproportionate to the operating performance of those companies. Broad market and industry factors, as well as general economic, political, regulatory and market conditions, may negatively affect the market price of our common stock, regardless of our actual operating performance. The market price of our common stock may decline below the initial public offering price, and you may lose some or all of your investment.

We could be subject to securities class action litigation.

        In the past, securities class action litigation has often been brought against companies following a decline in the market price of their securities. This risk is especially relevant for us because biotechnology companies have experienced significant share price volatility in recent years. If we face such litigation, it could result in substantial costs and a diversion of management's attention and resources, which could harm our business.

After this offering, our directors, executive officers and certain shareholders will continue to own a significant percentage of our common stock and, if they choose to act together, will be able to exert significant control over matters subject to shareholder approval.

        Upon the closing of this offering, our directors, executive officers, and shareholders affiliated with our directors and executive officers will beneficially own approximately %43.6% of the voting power of our outstanding common stock, or approximately %42.1% if the underwriters exercise their over-allotment option from us in full. Therefore, they will have the ability to substantially influence us through their ownership position. For example, these holders may be able to control elections of directors, amendments of our organizational documents, or approval of any merger, sale of assets, or other major corporate transaction. The interests of these holders may not always coincide with our

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corporate interests or the interests of other shareholders, and they may act in a manner with which you may not agree or that may not be in the best interests of our other shareholders. So long as they continue to own a significant amount of our equity, these holders will be able to strongly influence or effectively control our decisions.

If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our common stock, our stock price and trading volume could decline.

        The trading market for our common stock will depend, in part, on the research and reports that securities or industry analysts may publish about us or our business. We do not have any control over these analysts. If our financial performance fails to meet analyst estimates or one or more of the analysts who cover us downgrade our common stock or change their opinion of our common stock, our share price would likely decline. If one or more of these analysts cease coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline.

Because we do not anticipate paying any cash dividends on our common stock in the foreseeable future, capital appreciation, if any, will be your sole source of gain.

        We have never declared or paid any cash dividends on our common stock. We currently anticipate that we will retain future earnings for the development, operation and expansion of our business and do not anticipate declaring or paying any cash dividends for the foreseeable future. As a result, capital appreciation, if any, of our common stock would be your sole source of gain on an investment in our common stock for the foreseeable future. See "Dividend Policy" for additional information.

We will have broad discretion in the use of the net proceeds from this offering and may not use them effectively.

        We will have broad discretion in the application of the net proceeds from this offering and our shareholders will not have the opportunity as part of their investment decision to assess whether the net proceeds are being used appropriately. You may not agree with our decisions, and our use of the proceeds may not yield any return on your investment. Because of the number and variability of factors that will determine our use of the net proceeds from this offering, their ultimate use may vary substantially from their currently intended use. Our failure to apply the net proceeds of this offering effectively could compromise our ability to pursue our growth strategy and we might not be able to yield a significant return, if any, on our investment of these net proceeds.

A significant portion of our total outstanding shares is restricted from immediate resale but may be sold into the market in the near future, which could cause the market price of our common stock to decline significantly, even if our business is doing well.

        Sales of a substantial number of shares of our common stock in the public market after this offering, or the perception that these sales might occur, could depress the market price of our common stock and could impair our ability to raise capital through the sale of additional equity securities. Of our issued and outstanding common stock, all of the shares sold in this offering will be freely transferable without restrictions or further registration under the Securities Act of 1933, as amended (the "Securities Act") except for any shares acquired by our affiliates, as defined in Rule 144 under the Securities Act. The remaining shares outstanding after this offering will be restricted as a result of securities laws, lock-up agreements or other contractual restrictions that restrict transfers for 180 days, or in the case of our directors and officers for 12 months, after the date of this prospectus. See "Shares Eligible for Future Sale—Lock-Up Agreements."

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If you purchase shares of our common stock in this offering, you will incur immediate dilution in the book value of your shares.

        The initial public offering price of our common stock will be substantially higher than the as adjusted net tangible book value per share of our common stock. Therefore, if you purchase our common stock in this offering, you will pay a price per share of our common stock that substantially exceeds the book value of our tangible assets after subtracting our liabilities. Based on an assumed initial public offering price of $$7.00 per share, you will experience immediate dilution of $$5.64 per share, representing the difference between our net tangible book value per share, after giving effect to this offering, and the assumed initial public offering price. Further, the future exercise of any outstanding options to purchase shares of our common stock will cause you to experience additional dilution. See "Dilution."

We will incur increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives and corporate governance practices.

        As a public company, and particularly after we no longer qualify as an emerging growth company, we will incur significant legal, accounting and other expenses that we did not incur previously. The Sarbanes-Oxley Act of 2002, or SOX, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of NYSE American, and other applicable securities rules and regulations impose various requirements on U.S. reporting public companies, including the establishment and maintenance of effective disclosure and financial controls and corporate governance practices. Our management and other personnel will need to devote a substantial amount of time to these compliance initiatives. Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, we expect that these rules and regulations may make it more expensive for us to obtain director and officer liability insurance, which in turn could make it more difficult for us to attract and retain qualified senior management personnel or members for our board of directors. In addition, these rules and regulations are often subject to varying interpretations, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. Pursuant to Section 404 of SOX, or Section 404, we will be required to furnish a report by our senior management on our internal control over financial reporting.

        While we remain an emerging growth company, we will not be required to include an attestation report on internal control over financial reporting issued by our independent registered public accounting firm. To prepare for eventual compliance with Section 404, once we no longer qualify as an emerging growth company, we will be engaged in a process to document and evaluate our internal control over financial reporting, which is both costly and challenging. In this regard, we will need to continue to dedicate internal resources, potentially engage outside consultants and adopt a detailed work plan to assess and document the adequacy of internal control over financial reporting, continue steps to improve control processes as appropriate, validate through testing that controls are functioning as documented and implement a continuous reporting and improvement process for internal control over financial reporting. Despite our efforts, there is a risk that we will not be able to conclude, within the prescribed timeframe or at all, that our internal control over financial reporting is effective as required by Section 404. If we identify one or more material weaknesses, it could result in an adverse reaction in the financial markets due to a loss of confidence in the reliability of our financial statements.

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We are an "emerging growth company," and the reduced reporting requirements applicable to emerging growth companies may make our common stock less attractive to investors.

        We are an "emerging growth company," as defined in the Jumpstart Our Business Startups Act, or JOBS Act. For as long as we continue to be an emerging growth company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including exemption from compliance with the auditor attestation requirements of Section 404, reduced disclosure obligations regarding executive compensation and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the closing of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock held by non-affiliates exceeds $700 million as of the end of our prior second fiscal quarter, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.

        In addition, under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

        We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our share price may be more volatile.

Provisions in our restated certificate of incorporation and amended and restated bylaws and under Delaware law could make an acquisition of our company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management.

        Provisions in our restated certificate of incorporation and our amended and restated bylaws that will become effective upon the closing of this offering may discourage, delay or prevent a merger, acquisition or other change in control of our company that stockholders may consider favorable, including transactions in which our stockholders might otherwise receive a premium for their shares. These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock, thereby depressing the market price of our common stock. In addition, because our board of directors is responsible for appointing the members of our management team, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our board of directors. Among other things, these provisions include those establishing:

•

Advance notice bylaw provisions for proposals from stockholders for presentation at annual meetings; and



•

Forum selection bylaw provisions.

        Because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the General Corporation Law of the State of Delaware, which prohibits a person who owns in excess of 15% of our outstanding voting stock from merging or combining with us for a period of three years after the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved in a prescribed manner.

        Furthermore, our restated certificate of incorporation that will become effective upon the closing of this offering specifies that, unless we consent in writing to the selection of an alternative forum, the

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Court of Chancery of the State of Delaware will be the sole and exclusive forum for most legal actions involving actions brought against us by stockholders. We believe this provision benefits us by providing increased consistency in the application of Delaware law by chancellors particularly experienced in resolving corporate disputes, efficient administration of cases on a more expedited schedule relative to other forums and protection against the burdens of multi-forum litigation. However, the provision may have the effect of discouraging lawsuits against our directors and officers. The enforceability of similar choice of forum provisions in other companies' certificates of incorporation has been challenged in legal proceedings, and it is possible that, in connection with any applicable action brought against us, a court could find the choice of forum provisions contained in our restated certificate of incorporation to be inapplicable or unenforceable in such action.

Our bylaws designate the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders' ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

        Our bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware is the exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders with respect to our company and our directors. This choice of forum provision may limit a stockholder's ability to bring a claim in a judicial forum that the stockholder believes is favorable for disputes with us or our directors, which may discourage meritorious claims from being asserted against us and our directors. Alternatively, if a court were to find this provision of our charter inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business, financial condition or results of operations. We adopted this provision because we believe it makes it less likely that we will be forced to incur the expense of defending duplicative actions in multiple forums and less likely that plaintiffs' attorneys will be able to employ such litigation to coerce us into otherwise unjustified settlements.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

        This prospectus contains forward-looking statements. All statements other than statements of historical facts contained in this prospectus, including statements regarding our future results of operations and financial position, business strategy, prospective products, product approvals, research and development costs, timing and likelihood of success, plans and objectives of management for future operations and future results of anticipated products, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

        In some cases, you can identify forward-looking statements by terms such as "may," "will," "should," "expect," "plan," "anticipate," "could," "intend," "target," "project," "contemplate," "believe," "estimate," "predict," "potential" or "continue" or the negative of these terms or other similar expressions. The forward-looking statements in this prospectus are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this prospectus and are subject to a number of risks, uncertainties and assumptions described under the sections in this prospectus titled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere in this prospectus. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified and some of which are beyond our control, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.

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INDUSTRY AND OTHER DATA

        We obtained the industry, market and competitive position data in this prospectus from our own internal estimates and research as well as from industry and general publications and research, surveys and studies conducted by third parties. Information that is based on estimates, forecasts, market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances that are assumed in this information based on various factors, including those discussed in "Risk Factors."

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TRADEMARKS, SERVICE MARKS AND TRADE NAMES

        We own or have rights to use a number of registered and common law trademarks, service marks and/or trade names in connection with our business in the United States and/or in certain foreign jurisdictions.

        Solely for convenience, the trademarks, service marks, logos and trade names referred to in this prospectus are without the ® and ™ symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensors to these trademarks, service marks and trade names. This prospectus contains additional trademarks, service marks and trade names of others, which are the property of their respective owners. All trademarks, service marks and trade names appearing in this prospectus are, to our knowledge, the property of their respective owners. We do not intend our use or display of other companies' trademarks, service marks, copyrights or trade names to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

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USE OF PROCEEDS

        We estimate that the net proceeds from our sale of 1,428,571 shares of our common stock in this offering will be approximately $          ,$8.6 million, assuming an initial public offering price of $$7.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. If the underwriters exercise their over-allotment option in full, we estimate that our net proceeds will be approximately $          ,$9.9 million, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

        Each $1.00 increase or decrease in the assumed initial public offering price of $$7.00 per share, which is the midpoint of the range set forth on the cover page of this prospectus, would increase or decrease the net proceeds to us from this offering by approximately $          ,$1.3 million, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. At an assumed initial publicEach increase or decrease of 100,000 in the number of shares we are offering price of $          per share,would increase or decrease the net proceeds to us from this offering would increase by approximately $          ,$0.6 million, assuming the number of shares offered by us, as set forth on the cover page of the prospectus, remainsassumed initial public offering price stays the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. Each $1.00 increase in the initial public offering price above $          per share would increase the net proceeds to us from this offering by approximately $          , assuming the number of shares offered by us, as set forth on the cover of the prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. Each decrease of          in the number of shares we are offering would decrease the net proceeds to us from this offering, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us, by approximately $          , assuming the assumed initial public offering price stays the same. An increase of          shares in the number of shares offered by us, as set forth on the cover page of this prospectus, to          shares would increase the net proceeds to us from this offering by approximately $          , after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us and assuming the assumed initial public offering price stays the same. An increase in the number of shares offered by us, as set forth on the cover page of this prospectus, to          shares would increase the net proceeds to us from this offering by approximately $          , after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us and assuming the assumed initial public offering price stays the same. Each increase of          in the number of shares offered by us above          would increase the net proceeds to us from this offering by approximately          , after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us and assuming the initial public offering price stays the same.

        We currently anticipate that we will use the net proceeds from this offering, together with our existing resources, through 2020 as follows:

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approximately $3.0 million to commence and fund the costs to completion of the Phase 2a PD trial of ANVS-401 in the United States and, possibly, internationally, for the treatment of PD starting in the first quarter of 2020;



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approximately $0.8 million to fund the costs to completion of our continuing 2a trial of ANVS-401 in the United States in AD patients. This study is presently run and paid for by the Alzheimer's Disease Cooperative Study (ADCS);



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approximately $0.2 to commence the planning of the Phase 3 study of ANVS-401 in AD-DS for the treatment of memory loss and dementia in DS;



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approximately $2.0$1.7 million to conduct the chronic toxicology studies of ANVS-401 in rats and mice;dogs;

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•

approximately $0.7 million for payments under our license agreement with Horizon Therapeutics, PLC;



•

the rest for general and administrative expenses, including intellectual property legal costs, research and development related to ANVS-401, ANVS-405 and ANVS-301 and to provide sufficient liquidity until we raise additional capital for the Phase 3 studies of ANVS-401 in AD-DS and PD.

        We believe opportunities may exist from time to time to expand our current business through license or acquisitions of, or investments in, complementary businesses, products or technologies. While we currently have no agreements or commitments to complete any such transaction at this time, we may use a portion of the net proceeds for these purposes.

        The net proceeds from this offering, together with our cash, cash equivalents and marketable securities, will not be sufficient for us to fund any of our product candidates through regulatory approval, and we will need to raise additional capital to complete the development and commercialization of our product candidates. We may satisfy our future cash needs through the sale of equity securities, debt financings, working capital lines of credit, corporate collaborations or license agreements, grant funding, interest income earned on invested cash balances or a combination of one or more of these sources. ThisIn September 2019, we received a Notice of Award for a $1.7 million grant from the National Institute on Aging which is expected to fully cover the costs of the chronic toxicology studies of ANVS-401 in rats and dogs. We previously received a grant from the US Army to conduct the study of ANVS-405 described under Business—Preclinical Animal Studies—TBI in Rats in this Prospectus. We are in the process of writing a second grant proposal to conduct a follow-on study to

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evaluate the effect of ANVS-405 administered to TBI rats at various intervals post-injury to determine how long after a TBI we can effectively treat a patient. The ongoing study of ANVS-301 continues to be funded by the NIH and further development of ANVS-301 may be funded by future grants.

        The expected use of the net proceeds from this offering represents our intentions based upon our current plans and business conditions. We may also use a portion of the net proceeds to in-license, acquire, or invest in additional businesses, technologies, products or assets, although currently we have no specific agreements, commitments or understandings in this regard. As of the date of this prospectus, we cannot predict with certainty all of the particular uses for the net proceeds to be received upon the closing of this offering or the amounts that we will actually spend on the uses set forth above. The amounts and timing of our actual expenditures and the extent of clinical development may vary significantly depending on numerous factors, including the progress of our development efforts, the clinical trials we may commence in the future, as well as any collaborations that we may enter into with third parties for our product candidates and any unforeseen cash needs. As a result, our management will retain broad discretion over the allocation of the net proceeds from this offering.

        Based on our planned use of the net proceeds from this offering and our existing cash and cash equivalents, we estimate that such funds will be sufficient to enable us to fund our operating expenses and capital expenditure requirements for at least the next 18 months. We have based this estimate on assumptions that may prove to be incorrect, and we could use our available capital resources sooner than we currently expect.

        Pending our use of the net proceeds from this offering, we intend to invest the net proceeds in a variety of capital preservation investments, including short-term, investment-grade, interest-bearing instruments and U.S. government securities.

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DIVIDEND POLICY

        We have never declared or paid any cash dividends on our capital stock. We intend to retain future earnings, if any, to finance the operation and expansion of our business and do not anticipate paying any cash dividends in the foreseeable future. Investors should not purchase our common stock with the expectation of receiving cash dividends. Any future determination related to our dividend policy will be made at the discretion of our board of directors after considering our financial condition, results of operations, capital requirements, business prospects and other factors our board of directors deems relevant, and subject to the restrictions contained in any future financing instruments.

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CAPITALIZATION

        The following table sets forth our cash and cash equivalents and our capitalization as of June 30, 2019:

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on an actual basis;

•

on a pro forma basis to give effect to:

•

the automatic conversion of all outstanding shares of our preferred stock into 4,117,089 shares of our common stock upon the closing of this offering; and

•

the filing and effectiveness of our restated certificate of incorporation; and

•

on a pro forma as adjusted basis, giving effect to the pro forma adjustments set forth above and to give further effect to our issuance and sale of 1,428,571 shares of our common stock in this offering at an assumed initial public offering price of $$7.00 share, which is the midpoint of the price range set forth on the cover page of this prospectus, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us and the issuance of 97,084 shares of our common stock upon conversion of the $530,000 principal amount of our convertible promissory notes plus accrued interest upon the closing of this offering into shares of our common stock at a 20% discount to the public offering price.

        The pro forma as adjusted information below is illustrative only, and our capitalization following the completion of this offering will be adjusted based on the actual initial public offering price and other terms of this offering determined at pricing. You should read the following table together with our financial statements and the related notes appearing at the end of this prospectus and the "Selected Financial Data," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Description of Capital Stock" sections of this prospectus.

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        A $$1.00 increase or decrease in the assumed initial public offering price of $$7.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase or decrease the pro forma as adjusted amount of each of cash and cash equivalents, additional paid-in capital, total stockholders' equity (deficit) and total capitalization by approximately $$1.3 million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. At an assumed initial public offering priceAn increase or decrease of $          per share, the pro forma as adjusted amount of each of cash and cash equivalents, additional paid-in capital, total stockholders' equity and total capitalization would increase by approximately $           million, assuming the number of shares offered by us, as set forth on the cover page of the prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. A $          increase in the initial public offering price above $          per share would increase the pro forma as adjusted amount of each of cash and cash equivalents, additional paid-in capital, total stockholders' equity and total capitalization by approximately $           million, assuming the number of shares offered by us, as set forth on the cover of the prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. A decrease of100,000 shares in the number of shares offered by us, as set forth on the cover page of this prospectus, would increase or decrease the pro forma as adjusted amount of each of cash and cash equivalents, additional paid-in capital, total stockholders' equity (deficit) and total capitalization by approximately $$0.6 million, assuming no change in the assumed initial public offering price per share and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. An increase of          shares in the number of shares offered by us, as set forth on the cover page of this prospectus, to          shares would increase the pro forma as adjusted amount of each of cash and cash equivalents, additional paid-in capital, total stockholders' equity and total capitalization by approximately $           million, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us and assuming the assumed initial public offering price stays the same. An increase in the number of shares offered by us, as set forth on the cover page of this prospectus, to          shares would increase the pro forma as adjusted amount of each of cash and cash equivalents, additional paid-in capital, total stockholders' equity and total capitalization by approximately $           million, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us and assuming the assumed initial public offering price stays the same. An increase of          in the number of shares offered by us above would increase the pro forma as adjusted amount of each of cash and cash equivalents, additional paid-in capital, total stockholders' equity and total capitalization by approximately $           million, after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us and assuming the initial public offering price stays the same.

        The table above does not include:

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353,565 shares of common stock issuable upon exercise of stock options outstanding as of ,June 30, 2019, at a weighted-average exercise price of $0.19 per share; and



•

381,280 shares of our common stock that are available for future issuance under our 2018 Incentive Award Plan, or shares that will become available under our 2019 Plan, which will become effective in connection with this offering.

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DILUTION

        If you invest in our common stock in this offering, your ownership interest will be diluted immediately to the extent of the difference between the initial public offering price per share of our common stock and the pro forma as adjusted net tangible book value per share of our common stock immediately after this offering.

        Our historical net tangible book value deficit as of June 30, 2019 was $(8.1) million, or $(28.73) per share of our common stock. Our historical net tangible book value deficit is the amount of our total tangible assets less our total liabilities and our Series A and A-1 convertible preferred stock. Historical net tangible book value deficit per share represents our historical net tangible book value deficit divided by the 282,614 shares of our common stock outstanding as of June 30, 2019.

        Our pro forma net tangible book value deficit as of June 30, 2019, was $(1.6) million, or $(0.37) per share of our common stock. Pro forma net tangible book value represents the amount of our total tangible assets less our total liabilities, after giving effect to the automatic conversion of all outstanding shares of our preferred stock into 4,117,089 shares of our common stock upon the closing of this offering.

        After giving further effect to our issuance and sale of 1,428,571 shares of our common stock in this offering at an assumed initial public offering price of $$7.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us and after giving further effect to the issuance of 97,084 shares of our common stock upon conversion of the $530,000 principal amount of our convertible promissory notes plus accrued interest upon the closing of this offering into shares of our common stock at a 20% discount to the public offering price, our pro forma as adjusted net tangible book value as of June 30, 2019 would have been $          ,$8.1 million, or $$1.36 per share. This represents an immediate increase in pro forma as adjusted net tangible book value per share of $$1.60 to our existing stockholders and immediate dilution in pro forma as adjusted net tangible book value per share of $$5.64 to new investors purchasing common stock in this offering. Dilution per share to new investors purchasing common stock in this offering is determined by subtracting pro forma as adjusted net tangible book value per share after this offering from the assumed initial public offering price per share paid by new investors. The following table illustrates this dilution on a per share basis:

        The dilution information discussed above is illustrative only and will change based on the actual initial public offering price and other terms of this offering determined at pricing. A $$1.00 increase or decrease in the assumed initial public offering price of $$7.00 per share, which is the midpoint of the

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price range set forth on the cover page of this prospectus, would increase or decrease our pro forma as adjusted net tangible

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book value per share after this offering by $$0.22 and dilution per share to new investors purchasing common stock in this offering by $          ,$0.78, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. A $An increase in the assumed initial public offering price of $          per share, which is the midpoint of the price range set forth on the cover page of this prospectus would increase our pro forma as adjusted net tangible book value per share after this offering by $          and dilution per share to new investors purchasing common stock in this offering by $          , assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. Aor decrease of shares in the number of shares offered by us, as set forth on the cover page of this prospectus, would decrease our pro forma as adjusted net tangible book value per share after this offering by $          and increase dilution per share to new investors purchasing common stock in this offering by $          , assuming no change in the assumed initial public offering price per share and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. An increase of100,000 shares in the number of shares offered by us, as set forth on the cover page of this prospectus, would increase or decrease our pro forma as adjusted net tangible book value per share after this offering by $$0.9 and decrease dilution per share to new investors purchasing common stock in this offering by $          ,$0.9, assuming no change in the assumed initial public offering price per share and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

        If the underwriters' over-allotment option is exercised in full, our pro forma as adjusted net tangible book value per share after this offering would be $$1.54 and dilution per share to new investors purchasing common stock in this offering would be $          ,$5.46, assuming an initial public offering price of $$7.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.

        The following table summarizes, as of June 30, 2019, on a pro forma as adjusted basis, the total number of shares of common stock purchased from us on an as converted to common stock basis and the total consideration paid or to be paid and the average price per share paid or to be paid by existing stockholders and by new investors in this offering at an assumed initial public offering price of $$7.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, before deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. As the table shows, new investors purchasing our common stock in this offering will pay an average price per share substantially higher than our existing stockholders paid.

        A $$1.00 increase (decrease)or decrease in the assumed initial public offering price of $$7.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase (decrease)or decrease the total consideration paid by new investors by $$1.4 million and, in the case of an increase, would increase the percentage of total consideration paid by new investors by percentage points3.1% and, in the case of a decrease, would decrease the percentage of total consideration paid by new investors by percentage points,3.7%, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same. An increase (decrease)or decrease of 100,000 shares in the number of shares offered by us, as set forth on the cover page of this prospectus, would increase (decrease)or decrease the total consideration paid by new investors by $$0.7 million and, in the case of an

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increase, would increase the percentage of total consideration paid by new investors by percentage points1.6% and, in the case of a decrease, would decrease the percentage of total consideration paid by new investors by percentage points,1.7%, assuming no change in the assumed initial public offering price per share.

        The table above assumes no exercise of the underwriters' over-allotment option. If the underwriters' over-allotment option is exercised in full, upon completion of this offering, the numberpercentage of shares of our common stock held by existing stockholders would be reduced to % of the total number of shares of our common stock outstanding after this offering,73.2%, and the numberpercentage of shares

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common stock held by new investors purchasing common stock in this offering would be increased to % of the total number of shares outstanding after this offering.26.8%.

        The tables above do not include:

•

353,565 shares of common stock issuable upon exercise of stock options outstanding as of ,June 30, 2019, at a weighted-average exercise price of $0.19 per share; and



•

381,280 shares of our common stock that are available for future issuance under our 2018 Incentive Award Plan, or shares that will become available under our 2019 Plan, which will become effective in connection with this offering; andoffering.

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SELECTED FINANCIAL DATA

        You should read the following selected financial data together with our financial statements and the related notes appearing at the end of this prospectus and the "Management's Discussion and Analysis of Financial Condition and Results of Operations" section of this prospectus. We have derived the statement of operations data for the years ended December 31, 2018 and 2017 from our audited financial statements appearing at the end of this prospectus. We have derived the statement of operations data for the six months ended June 30, 2019 and 2018 and the balance sheet data as of June 30, 2019 from our unaudited interim financial statements appearing at the end of this prospectus. The unaudited interim financial statements have been prepared on the same basis as the audited financial statements and reflect, in the opinion of management, all adjustments of a normal, recurring nature that are necessary for a fair presentation of the unaudited interim financial statements. Our historical results are not necessarily indicative of results that should be expected in any future period, and our results for any interim period are not necessarily indicative of results that should be expected for any full year.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

        The following discussion summarizes the significant factors affecting the operating results, financial condition, liquidity and cash flows of our company as of and for the periods presented below. The following discussion and analysis should be read in conjunction with "Prospectus Summary—Summary Financial Information," "Selected Financial Information" and the financial statements and the related notes thereto included elsewhere in this prospectus. The statements in this discussion regarding industry outlook, our expectations regarding our future performance, liquidity and capital resources and all other non-historical statements in this discussion are forward-looking statements and are based on the beliefs of our management, as well as assumptions made by, and information currently available to, our management. Actual results could differ materially from those discussed in or implied by forward-looking statements as a result of various factors, including those discussed below and elsewhere in this prospectus, particularly in the section entitled "Risk Factors."

Overview

Company Overview

        We are a clinical stage, drug platform company addressing neurodegeneration such as Alzheimer's disease in Down Syndrome (AD-DS), Alzheimer's disease (AD), Parkinson's disease (PD). Our lead compound, ANVS-401, is a small molecule administered orally that attacks neurodegeneration by entering the brain and inhibiting the translation of neurotoxic proteins—amyloid precursor protein APP/Ab (APP), tau/phospho-tau (tau) anda-Synuclein (aSYN)—thereby improving axonal transport. Human studies in four MCI patients have shown that ANVS-401 lowered the levels of these neurotoxic proteins and inflammatory factors. In preclinical studies, lower neurotoxic protein levels also led to the repair ofimproved axonal transport, reduction ofreduced inflammation, prevention oflower nerve cell death and restoration ofimproved function.

        AD is a substantial market affecting over 30 million people worldwide and is expected to grow to over 100 million by 2050. While the market for neurodegeneration is over $100 billion, to date there are no disease modifying drugs (DMD) for any neurodegenerative condition. Enormous efforts have gone into developing better drugs to treat neurodegeneration and the outcomes have been sobering. The results of clinical trials in AD, the two AD orphan indications AD-DS and early onset familial AD or in PD have not supported the development of successful disease modifying therapies.

        ANVS-401 is a small lipophilic molecule that is orally available and readily enters the brain, as demonstrated by preclinical pharmacokinetics analyses showing brain concentrations approximately six to eight times higher than plasma concentrations. ANVS-401 has a mechanism of action that we believe to be unique, in that it inhibitsinhibited the translationover-translation of and, therefore, reduced the levels of several neurotoxic aggregating proteins bothin vitro andin vivo including APP, tau andaSYN.

        By targeting multiple neurotoxic proteins, ANVS-401 resembles a combination therapy approach, with the added convenience of being a single drug with a single drug target. Therefore, we have worked to understand how ANVS-401 is able to inhibit the translation of more than one neurotoxic protein.

        We are presently conducting a Phase 2a study in AD patients in collaboration with the Alzheimer Disease Cooperative Study (ADCS) groupADCS and plan to initiate a second Phase 2a proof-of-concept study of ANVS-401 in the first quarter of 2020 with 50 PD patients. We have designed the two Phase 2a studies with Parexel by applying our understanding of the underlying disease states in neurodegeneration and by measuring not just target, but also pathway validation in the spinal fluid of these patients. Successful completion of the AD and PD study will validate theIf we are able to show both target and pathway and provide us with data to design thevalidation in two patient populations, we believe that our opportunity for successful Phase 3 studies with ANVS-401.is better than if we merely demonstrated target validation in one patient population.

        We have never been profitable and have incurred net losses since inception. Our net losses were $713,871 and $682,349 for the years ended December 31, 2018 and 2017, respectively. Our net losses

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for the six months ended June 30, 2019 and 2018 were $535,603 and $408,086, respectively, and our accumulated deficit at June 30, 2019 was $8,321,651. We expect to incur losses for the foreseeable future, and we expect these losses to increase as we continue our development of, and seek regulatory approvals for, our product candidate. Because of the numerous risks and uncertainties associated with product development, we are unable to predict the timing or amount of increased expenses or when, or if, we will be able to achieve or maintain profitability.

Financial Operations Overview

        The following discussion sets forth certain components of our statements of operations as well as factors that impact those items.

Research and Development Expenses

        Our research and development expenses consist of expenses incurred in development and clinical studies relating to our product candidate, including:

•

expenses associated with clinical development;



•

personnel-related expenses, such as salaries, benefits, travel and other related expenses, including stock-based compensation;



•

payments to third-party contract research organizations, or CROs, contractor laboratories and independent contractors; and



•

depreciation, maintenance and other facility-related expenses.

        We expense all research and development costs as incurred. Clinical development expenses for our product candidate is a significant component of our current research and development expenses. Product candidates in later stage clinical development generally have higher research and development expenses than those in earlier stages of development, primarily due to increased size and duration of the clinical trials. We track and record information regarding external research and development expenses for each study or trial that we conduct. From time to time, we use third-party CROs, contractor laboratories and independent contractors in clinical studies. We recognize the expenses associated with third parties performing these services for us in our clinical studies based on the percentage of each study completed at the end of each reporting period.

        We expect that our research and development expenses in 2019 and for the next several years will be higher than in 2018 as a result of increased expenditures for our Phase 2a study in AD and the work needed for our expected initiation of our Phase 2a study in PD during the first quarter of 2020. These expenditures are subject to numerous uncertainties regarding timing and cost to completion. Completion of our clinical development and clinical trials may take several years or more and the length of time generally varies according to the type, complexity, novelty and intended use of our product candidates. The cost of clinical trials may vary significantly over the life of a project as a result of differences arising during clinical development, including, among others:

•

the number of sites included in the clinical trials;



•

the length of time required to enroll suitable patients;



•

the size of patient populations participating in the clinical trials;



•

the duration of patient follow-ups;



•

the development stage of the product candidates; and



•

the efficacy and safety profile of the product candidates.

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        Due to the early stage of our research and development, we are unable to determine the duration or completion costs of our development of ANVS-401. As a result of the difficulties of forecasting research and development costs of ANVS-401 as well as the other uncertainties discussed above, we are unable to determine when and to what extent we will generate revenues from the commercialization and sale of an approved product candidate.

General and Administrative Expenses

        General and administrative expenses consist primarily of salaries, benefits and other related costs, including stock-based compensation, for personnel serving in our executive, finance, accounting, legal and human resource functions. Our general and administrative expenses also include facility and related costs not included in research and development expenses, professional fees for legal services, including patent-related expenses, consulting, tax and accounting services, insurance and general corporate expenses. We expect that our general and administrative expenses will increase with the continued development and potential commercialization of our product candidate.

        We expect that our general and administrative expenses in 2019 and for the next several years will be higher than in 2018 as we increase our headcount. We also anticipate increased expenses relating to our operations as a public company, including increased costs for the hiring of additional personnel, and for payment to outside consultants, including lawyers and accountants, to comply with additional regulations, corporate governance, internal control and similar requirements applicable to public companies, as well as increased costs for insurance.

Interest Income (Expense), net

        Interest income (expense) consists primarily of interest earned on our money market bank account and interest expense on our convertible debt, including amortization of deferred financing fees and debt discount.

Income Taxes

        As of December 31, 2018, the Company had U.S. federal net operating loss carryforwards of $3,394,475, which may be available to offset future income tax liabilities. Federal net operating loss carryforwards generated in 2017 and prior of $2,764,240 will expire beginning 2028. The remaining $630,235 of federal net operating loss carryforwards generated in 2018, do not expire but are limited 80% of taxable income in future years. These operating loss and research tax credit carryforwards will begin to expire in 2027 and 2034, respectively.

        On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act tax reform legislation ("TCJA"). This legislation makes significant changes in U.S. tax law including a reduction in the corporate tax rates, changes to net operating loss "NOL" carryforwards and carrybacks, and a repeal of the corporate alternative minimum tax. The legislation reduced the U.S. corporate tax rate from the current rate of 34% to 21%. As a result of the enacted law, the Company was required to revalue deferred tax assets and liabilities at the enacted rate. This revaluation resulted in a decrease in net deferred tax asset of $335,717 million and a corresponding reduction in the valuation allowance against these assets. There is no impact to income tax expense. The other provisions of the TCJA did not have a material impact on the 2018 or 2017 financial statements.

        Our preliminary estimate of the TCJA and the re-measurement of its deferred tax assets and liabilities is subject to the finalization of management's analysis related to certain matters, such as developing interpretations of the provisions of the TCJA, changes to certain estimates and the filing of our tax returns. U.S. Treasury regulations, administrative interpretations or court decisions interpreting the TCJA may require further adjustments and changes in our estimates. We completed the analysis of

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the 2017 Tax Act during the fourth quarter of 2018 and had no material changes to the original analysis.

        Net operating loss and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service (the "IRS") and may become subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant shareholders over a three-year period in excess of 50% as defined under Sections 382 and 383 in the Internal Revenue Code. This could substantially limit the amount of tax attributes that can be utilized annually to offset future taxable income or tax liabilities. The amount of the annual limitation is determined based on our value immediately prior to the ownership change. Subsequent ownership changes may further affect the limitation in future years.

Critical Accounting Policies and Use of Estimates

        We have based our management's discussion and analysis of financial condition and results of operations on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported revenues and expenses during the reporting periods. On an ongoing basis, we evaluate our estimates and judgments, including those related to clinical development expenses and stock-based compensation. We base our estimates on historical experience and on various other factors that we believe to be appropriate under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

        While our significant accounting policies are more fully discussed in note 2 to our audited financial statements appearing at the end of this prospectus, we believe that the following accounting policies are critical to the process of making significant judgments and estimates in the preparation of our financial statements.

Research and Development Expenses

        We rely on third parties to conduct our preclinical studies and to provide services, including data management, statistical analysis and electronic compilation. Once our clinical trials begin, at the end of each reporting period, we will compare the payments made to each service provider to the estimated progress towards completion of the related project. Factors that we will consider in preparing these estimates include the number of patients enrolled in studies, milestones achieved and other criteria related to the efforts of our vendors. These estimates will be subject to change as additional information becomes available. Depending on the timing of payments to vendors and estimated services provided, we will record net prepaid or accrued expenses related to these costs.

Fair Value of Common Stock and Stock-Based Compensation

        We account for grants of stock options to employees and non-employees based on their grant date fair value and recognize compensation expense over the vesting periods. We estimate the fair value of stock options as of the date of grant using the Black-Scholes option pricing model. Estimates in our share-based compensation valuations are highly complex and subjective.

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        In the absence of a public trading market for our common stock, on each grant date, we develop an estimate of the fair value of our common stock underlying the option grants. Once our common stock is publicly traded, we will no longer have to estimate the fair value of the common stock, rather we will determine the value based on quoted market prices. We determined the fair value of our common stock using methodologies, approaches and assumptions consistent with the AICPA Practice Guide, Valuation of Privately Held Company Equity Securities Issued as Compensation, and based in part on input from an independent third-party valuation firm.

        During the two-year period ended December 31, 2016, we issued an aggregate of 125,701 options with exercise prices of $0.14 per share. During the year ended December 31, 2017, we issued an additional 154,754 options with exercise prices of $0.14 per share. For purposes of recognizing compensation expense in our financial statements, we retrospectively estimated the value of the common stock underlying these grants to be $0.36 per share. We used the Option Pricing Model (OPM) Backsolve method utilizing the Series A preferred stock price of $0.50 per share, which equates to a conversion price to common stock of $0.70 per share. The OPM requires the use of assumptions such as the volatility of our stock and the time period until a potential liquidity event. We also estimated and applied a discount for the lack of marketability of our stock. We determined the value per common share had remained constant during this period because we issued Series A preferred stock at $0.50 per share at various dates from December 2014 through October 2016. Further, our research and development efforts, our clinical programs and our stage of development had not progressed significantly over this period.

        In April 2018, we issued 123,800 options with exercise prices of $0.25 per share. For purposes of recognizing compensation expense in our financial statements, we retrospectively estimated the value of the common stock underlying these grants to be $0.85 per share using the Probability Expected Return Method (PWERM). The PWERM requires us to make assumptions regarding the likelihood of potential outcomes such as a sale of Annovis, an initial public offering, or dissolution, as well as the timing and estimated proceeds to be received in each scenario. We estimated the proceeds to be received based on a market approach utilizing values for the acquisition or initial public offering of comparable public companies. We also estimated and applied a discount for the lack of marketability of our stock. The increase in the fair value per share of common stock compared to prior grant dates reflected our expectations of progress to be made in our clinical trials in 2018. In addition, the increase was consistent with the increase in the price per share of our preferred stock as we issued shares of our Series A-1 preferred stock in December 2017 and March 2018 at a price per share of $0.90, which equates to a conversion price to common stock of $1.26 per share.

Results of Operations

        Operating expenses were comprised of the following:

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Years Ended December 31, 2018 and 2017

Research and Development Expenses

        Research and development expenses decreased by $161,762, or 59%, to $111,608 for the year ended December 31, 2018 from $273,370 for the year ended December 31, 2017. The decrease was primarily the result of a $162,000 decrease in contract research costs.

General and Administrative Expenses

        General and administrative expenses increased by $193,267 to $602,329 for the year ended December 31, 2018 from $409,063 for the year ended December 31, 2017. The increase was primarily the result of a $128,000 increase for intellectual property legal costs, an increase in consulting costs for legal and business development and an increase in stock-based compensation expense.

Six Months Ended June 30, 2019 and 2018

Research and Development Expenses

        Research and development expenses decreased by $72,988, or 86%, to $12,061 for the six months ended June 30, 2019 from $85,049 for the six months ended June 30, 2018. The decrease was primarily the result of the completion of a number of studies in 2018.

General and Administrative Expenses

        General and administrative expenses increased by $157,719, or 49%, to $480,805 for the six months ended June 30, 2019 from $323,086 for the six months ended June 30, 2018. The increase was primarily the result of an increase in accounting, legal and consulting costs.

Liquidity and Capital Resources

        Since our inception in 2008, we have devoted most of our cash resources to research and development and general and administrative activities. We have financed our operations primarily with the proceeds from the sale of common stock, convertible preferred stock and convertible promissory notes. To date, we have not generated any revenues from the sale of products, and we do not anticipate generating any revenues from the sales of products for the foreseeable future. We have incurred losses and generated negative cash flows from operations since inception. As of June 30, 2019, our principal source of liquidity was our cash, which totaled $104,551.

Equity Financings

        For the years ended December 31, 2018 and 2017, we received net proceeds of $246,449 and $332,495, respectively, from the sale of common and redeemable convertible preferred stock. For the six months ended June 30, 2019 and 2018, we received proceeds of $0 and $243,649, respectively, from the sale of common and redeemable convertible preferred stock.

Debt

        We had no debt outstanding during the years ended December 31, 2018 and 2017. In March 2019, we issued an aggregate of $530,000 principal amount of convertible promissory notes, which will convert upon the closing of this offering into shares of our common stock at a 20% discount to the public offering price.

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Future Capital Requirements

        We expect that the net proceeds from this offering and our existing cash and cash equivalents will be sufficient to fund our operations and capital requirements for at least the next 18 months. We believe that these available funds will be sufficient to complete our Phase 2a clinical trial for ANVS-401 and commence the planning of our Phase 3 study in AD-DS for this product candidate. However, it is difficult to predict our spending for our product candidates prior to obtaining FDA approval. Moreover, changing circumstances may cause us to expend cash significantly faster than we currently anticipate, and we may need to spend more cash than currently expected because of circumstances beyond our control.

        Our expectations regarding future cash requirements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments that we make in the future. We have no current understandings, agreements or commitments for any material acquisitions or licenses of any products, businesses or technologies. We may need to raise substantial additional capital in order to engage in any of these types of transactions.

        We expect to continue to incur substantial additional operating losses for at least the next several years as we continue to develop our product candidates and seek marketing approval and, subject to obtaining such approval, the eventual commercialization of our product candidates. If we obtain marketing approval for our product candidates, we will incur significant sales, marketing and outsourced manufacturing expenses. In addition, we expect to incur additional expenses to add operational, financial and information systems and personnel, including personnel to support our planned product commercialization efforts. We also expect to incur significant costs to comply with corporate governance, internal controls and similar requirements applicable to us as a public company following the closing of this offering.

        Our future use of operating cash and capital requirements will depend on many forward-looking factors, including the following:

•

the initiation, progress, timing, costs and results of clinical trials for our product candidates;



•

the clinical development plans we establish for our product candidates;



•

the number and characteristics of product candidates that we develop or may in-license;



•

the terms of any collaboration agreements we may choose to execute;



•

the outcome, timing and cost of meeting regulatory requirements established by the DEA, the FDA, the EMA or other comparable foreign regulatory authorities;



•

the cost of filing, prosecuting, defending and enforcing our patent claims and other intellectual property rights;



•

the cost of defending intellectual property disputes, including patent infringement actions brought by third parties against us;



•

costs and timing of the implementation of commercial scale manufacturing activities; and



•

the cost of establishing, or outsourcing, sales, marketing and distribution capabilities for any product candidates for which we may receive regulatory approval in regions where we choose to commercialize our products on our own.

        To the extent that our capital resources are insufficient to meet our future operating and capital requirements, we will need to finance our cash needs through public or private equity offerings, debt financings, collaboration and licensing arrangements or other financing alternatives. We have no committed external sources of funds. Additional equity or debt financing or collaboration and licensing arrangements may not be available on acceptable terms, if at all.

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        If we raise additional funds by issuing equity securities, our stockholders will experience dilution. Debt financing, if available, would result in increased fixed payment obligations and may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. Any debt financing or additional equity that we raise may contain terms, such as liquidation and other preferences that are not favorable to us or our stockholders. If we raise additional funds through collaboration and licensing arrangements with third parties, it may be necessary to relinquish valuable rights to our technologies, future revenue streams or product candidates or to grant licenses on terms that may not be favorable to us.

Cash Flows

        The following table summarizes our cash flows from operating, investing and financing activities.

Years ended December 31, 2018 and 2017

Operating Activities

        For the year ended December 31, 2018, cash used in operations was $558,609 compared to $537,481 for the year ended December 31, 2017. The increase in cash used in operations was primarily the result of the increase in net loss and a reduction in accounts payable and accrued expense balances from 2017.

        We expect cash used in operating activities to continue to increase in 2019 as compared to 2018 due to an expected increase in our operating losses associated with ongoing development of our product candidate.

Financing Activities

        Cash provided by financing activities was $246,449 during the year ended December 31, 2018, attributable to $243,649 from the sale of 270,722 shares of our Series A-1 Preferred Stock and $2,800 from the sale of 14,286 shares of our common stock. Cash provided by financing activities was $332,495 during the year ended December 31, 2017, attributable to $324,000 from the sale of 360,000 shares of our Series A-1 Preferred Stock and $8,495 from the sale of 50,131 shares of our common stock.

Six Months Ended June 30, 2019 and 2018

Operating Activities

        For the six months ended June 30, 2019, cash used in operations was $379,332 compared to $353,638 for the six months ended June 30, 2018. The increase in cash used in operations was primarily the result of an increase in prepaid expense balances.

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Financing Activities

        Cash provided by financing activities was $448,571 for the six months ended June 30, 2019, attributable to the $530,000 proceeds from the sale of convertible promissory notes partially offset by the payment of $73,128 of deferred offering costs and $8,301 of fees on the issuance of the convertible promissory notes. Cash provided by financing activities was $246,449 for the six months ended June 30, 2018, attributable to $243,649 from the sale of 270,722 shares of our Series A-1 Preferred Stock and $2,800 from the sale of 14,286 shares of our common stock.

Off-Balance Sheet Arrangements

        We do not have any off-balance sheet arrangements, except for operating leases, or relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities.

Recent Accounting Pronouncements

        In February 2016, the FASB issued its final standard on lease accounting, ASU No. 2016-02, "Leases (Topic 842)," which superseded Topic 840, "Leases," which was further modified in ASU No. 2018-10, "Codification Improvements to Topic 842, Leases," ASU No. 2018-11, "Leases (Topic 842) Targeted Improvements" and ASU No. 2019-01 "Leases (Topic 842) Codification Improvements" to clarify the implementation guidance. The new pronouncement requires the recognition on the balance sheet of right-of-use assets and lease liabilities for all long-term leases, including operating leases, on the balance sheet. The pronouncement requires that lease arrangements longer than 12 months result in an entity classifying leases as a finance or operating leases. However, unlike current U.S. GAAP, which requires only capital leases to be recognized on the balance sheet, ASU 2016-02 will require both types of leases to be recognized on the balance sheet. ASU 2016-02 also requires disclosures about the amount, timing, and uncertainty of cash flows arising from leases. These disclosures include qualitative and quantitative requirements, providing additional information about the amounts recorded in the financial statements.

        The pronouncement is effective for all public business entities for interim and annual periods beginning after December 15, 2018 and for non-public business entities with annual periods beginning after December 15, 2019 with early adoption permitted. In July 2018, the FASB issued ASU No. 2018-11, which provides targeted improvements to the new lease standard, including an option to apply the transition provisions at its adoption date instead of at the earliest comparative period presented in its financial statements. We adopted the new leasing standards using a modified retrospective transition approach to be applied to leases existing as of or entered into after January 1, 2019. The adoption of this guidance did not have a material impact on our financial statements.

        In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), requiring an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 supersedes nearly all existing revenue recognition guidance under U.S. GAAP and requires revenue to be recognized when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. Additionally, qualitative and quantitative disclosures are required about customer contracts, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract.

        The FASB also issued the following amendments to ASU No. 2014-09 to provide clarification on the guidance:

•

ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606)—Deferral of the Effective Date

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•

ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606)—Principal versus Agent (Reporting Revenue Gross vs. Net)



•

ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606)—Identifying Performance Obligations and Licensing



•

ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606)—Narrow-Scope Improvements and Practical Expedients

        We have elected to early adopt ASU 2014-09 effective January 1, 2017. The standard did not have an impact on our financial statements

        In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments, which provides specific guidance related to eight cash flow classification issues. The pronouncement is effective for interim and annual periods beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. We elected to early adopt the new pronouncement in the first quarter of 2019. Such early adoption of ASU 2016-15 in the first quarter of 2019 did not have an impact on our financial statements.

        In November 2016, the FASB issued ASU 2016-18, Restricted Cash, which requires changes in restricted cash and restricted cash equivalents to be explained on the statement of cash flows by including restricted cash and restricted cash equivalents in the beginning-of-period and end-of-period total cash and cash equivalents shown on the statement of cash flows. The pronouncement is effective for interim and annual periods beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. We elected to early adopt ASU 2016-18. The early adoption of ASU 2016-18 in the first quarter of 2019 did not have an impact on our financial statements.

        In March 2018, the FASB issued ASU 2018-5—Income Taxes (Topic 740): Amendments to SEC Paragraphs pursuant to SEC Staff Accounting Bulletin No. 118. This ASU provided guidance related to Securities and Exchange Commission ("SEC") Staff Accounting Bulletin No. 118 ("SAB 118"), which addresses the accounting implications of the Tax Act. SAB 118 allows a company to record provisional amounts during a measurement period not to extend beyond one year of the enactment date and was effective upon issuance. We have analyzed the Tax Act, and in certain areas, has made reasonable estimates of the effects on its financial statements and tax disclosures.

        In June 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. The new guidance expands the scope of Topic 718 to include share-based payments granted to nonemployees in exchange for goods or services used or consumed in an entity's own operations, and supersedes the guidance in ASC 505-50, Equity-Based Payments to Non-Employees. The most significant change resulting from this update is that stock-based awards granted to non-employees will no longer need to be re-measured at fair value at each financial reporting date until performance is complete, as these awards will be measured at fair value at the grant date. The guidance is effective January 1, 2019 with early adoption permitted, including in an interim period for which financial statements have not been issued. We elected to apply the provisions of this ASU in our financial statements effective January 1, 2017.

        In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820)—Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The new guidance improves and clarifies the fair value measurement disclosure requirement of ASC 820. The new disclosure requirements include the changes in unrealized gains or losses included in other comprehensive income for recurring Level 3 fair value measurement held at the end of reporting period and the explicit requirement to disclose the range and weighted average used to develop

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significant unobservable inputs for Level 3 fair value measurements. The other provisions of ASU 2018-13 also include eliminated and modified disclosure requirements. The guidance is effective for fiscal years beginning after December 15, 2019 with early adoption permitted, including in an interim period for which financial statements have not been issued or made available for issuance. We have evaluated the impact of adoption of this ASU and determined that it will not have a significant impact on our financial statements.

Quantitative and Qualitative Disclosures about Market Risk

        We are exposed to various market risks, which may result in potential losses arising from adverse changes in market rates, such as interest rates and foreign exchange rates. We do not enter into derivatives or other financial instruments for trading or speculative purposes and do not believe we are exposed to material market risk with respect to our cash and cash equivalents.

        We currently have no operations outside the United States, but we have contracted with third parties to manufacture our product candidates and conduct clinical trials outside of the United States. At this time, such manufacturing and research costs are paid for in U.S. dollars and, therefore, are not subject to fluctuations in exchange rates. If we conduct additional clinical trials outside of the United States in the future, we may be required or may choose to pay for those clinical trials in a local foreign currency and could incur foreign currency exchange rate risk.

        We do not engage in any hedging activities against changes in interest rates or foreign currency exchange rates. Because of the short-term maturities of our cash and cash equivalents, we do not believe that an immediate 10% increase in interest rates would have any significant impact on the realized value of our investments.

JOBS Act

        On April 5, 2012, the Jumpstart Our Business Startups Act of 2012, or JOBS Act, was signed into law. The JOBS Act contains provisions that, among other things, reduce certain reporting requirements for an "emerging growth company." As an "emerging growth company," we are electing not to take advantage of the extended transition period afforded by the JOBS Act for the implementation of new or revised accounting standards, and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision not to take advantage of the extended transition period is irrevocable.

        Subject to certain conditions set forth in the JOBS Act, as an "emerging growth company," we are not required to, among other things, (i) provide an auditor's attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor's report providing additional information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation-related items such as the correlation between executive compensation and performance and comparisons of the chief executive officer's compensation to median employee compensation. These exemptions will apply until the fifth anniversary of the completion of our initial public offering or until we no longer meet the requirements for being an "emerging growth company," whichever occurs first.

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FOUNDERS' VISION

WE STRIVE TO PROTECT NERVE CELLS FROM DYING

        Neurodegenerative diseases impact millions of people including our own families and friends, and eventually many of us may be afflicted by one of them. Research has come a long way in providing better insights into the brain, its workings and its shortfalls, and our goal is to defeat these diseases by protecting nerve cells from dying and by restoring homeostasis in the brain.

        This is a great challenge and an even greater opportunity: defeating neurodegeneration by preserving nerve cells and their function allows people to age with dignity, allows loved ones to enjoy their parents and family members into old age and may help healthcare systems from becoming overwhelmed.

        Recent insights into the functioning of the brain and the interaction between nerve cells have given us the tools to look at the toxic cascades, at their path of destruction and at how to stop the course. We are working hard to engineer medicines that are orally available, cross the blood brain barrier and normalize brain homeostasis. While we are in clinical stage, we have not yet established the safety and efficacy of our drug candidates. We will need to obtain regulatory approval after further clinical trials, which we cannot assure will be successful. However, we have been able to show in preclinical and early clinical studies that these drugs can interfere with the toxic cascade at the very beginning and by doing so, may slow down or stop the destruction of nerve cells.

        We have assembled what we believe to be an outstanding team and a network of collaborators who are passionate about solving the diseases all leading to neurodegeneration, such as Alzheimer's disease in Down syndrome, Alzheimer's disease and Parkinson's disease.

        Our main goal is to provide a solution to the problems that patients of neurodegenerative diseases face. We are also mindful, however, of the risks that we will face in this process. Please, join us in our journey as we seek to develop drugs to mitigate the effects of neurodegeneration.

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BUSINESS

Our Company

        Annovis is a clinical stage, drug platform company addressing neurodegeneration, such as Alzheimer's disease in Down syndrome (AD-DS), Alzheimer's disease (AD) and Parkinson's disease (PD). We have an ongoing Phase 2a proof-of-concept study in AD patients and have planned to commence a second Phase 2a study in PD patients. We are developing our lead compound, ANVS-401, for chronic neurodegenerative diseases, such as AD-DS, AD and PD. In several studies, ANVS-401 inhibited the synthesis of neurotoxic proteins—APP/Ab (APP), tau/phospho-tau (tau) anda-Synuclein (aSYN)—that are the main cause of neurodegeneration. High levels of neurotoxic proteins lead to impaired axonal transport, which is responsible for the communication between and within nerve cells. When that communication is impaired, the immune system is activated and attacks the nerve cells, eventually killing them. Through our patented product platform, we have shown in four mildly cognitive impaired (MCI) patients that ANVS-401 lowered the levels of these neurotoxic proteins and inflammatory factors. In preclinical studies, lower neurotoxic protein levels also led to the repair ofimproved axonal transport, reduced inflammation, prevention oflower nerve cell death and restoration ofimproved function.

        The industry has encountered challenges in targeting specifically one or the other neurotoxic protein, be it APP, tau oraSYN, indicating that targeting one neurotoxic protein alone does not change the course of neurodegeneration. Our goal is to develop a disease modifying drug (DMD) for patients with neurodegeneration by leveraging our clinical and animal evidence in inhibiting at least the three most relevant neurotoxic proteins.

        We believe that we are the only company developing a clinical stage proof-of-concept drug for AD-DS, AD and PD that inhibits more than one neurotoxic protein and has a mechanism of action designed to restore nerve cell axonal and synaptic activity. By repairingimproving axonal transport in the brain, we expect to treat memory loss and dementia associated with AD-DS and AD as well as body and brain function in PD.

        We believe that ANVS-401 has the potential to be the first drug to interfere with the underlying mechanism of neurodegeneration. ANVS-401 is a small, once a day, orally administered, brain penetrant inhibitor of neurotoxic proteins. The biological activity of ANVS-401 has been evaluated in 19 animal studies conducted in leading institutions such as the Karolinska Institute, Columbia University and Harvard University. 16 of the studies are published and three are presently manuscripts in preparation. We also conducted three clinical trials with 125 humans including two safety studies in 120 healthy volunteers and a proof-of-concept study in fivefour MCI patients with Parexel, an international clinical research organization. In these studies, we showed that ANVS-401 was well tolerated and we saw promising clinical signals: in all four patients, who completed the trial, ANVS-401 reduced the levels of APP, tau andaSYN (aSYN is an unpublished, not statistically significant observation) back to the levels seen in healthy volunteers and lowered inflammatory factors.

        We are presently conducting a Phase 2a study in AD patients in collaboration with the Alzheimer Disease Cooperative Study (ADCS) group and plan to initiate a second Phase 2a proof-of-concept study of ANVS-401 in the first quarter of 2020 with 50 PD patients. The AD study being conducted by ADCS is expected to enroll a total of 24 persons at three dose levels plus placebo in a double-blind, placebo-controlled fashion. To date, the study has enrolled and treated eight early to moderate AD patients. Under an agreement with UC San Diego, where ADCS is located, we have contracted to provide study supplies at our cost. The agreement also contains standard indemnification and confidentiality provisions and may be terminated by either party upon 30 days' written notice. We have designed the two Phase 2a studies with Parexel by applying our understanding of the underlying disease states in neurodegeneration and by measuring not just target, but also pathway validation in the spinal fluid of these patients. This means that we are proposing to measure as many factors as possible associated with the toxic cascade precipitated by impaired axonal transport. By showingIf we are able to show both target and

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pathway validation in two patient populations, we believe that our opportunity for successful Phase 3 studies is better than if we merely demonstrated target validation in one patient population.

        We believe that AD and PD are two of the largest medical needs of the aging U.S. population, and two potentially large markets, once a DMD has been developed and approved. Therefore, we desire to demonstrate ANVS-401's efficacy in both indications. However, since AD studies are very large and time and capital consuming, we plan to focus on an orphan population that is substantially similar to AD, but in a very controlled and limited setting. We intend to focus on AD in the DS population, because in DS the APP gene is triplicated, leading to early onset AD with similar pathology as sporadic AD. In our animal studies in DS mice, lowering their high levels of APP restoredimproved axonal transport in the brain and increased memory and learning.learning as described on page 89. In accordance with this animal data, we expect that lowering levels of APP, tau andaSYN in DS human patients will lead to an improvement in their memory, cognition and dementia. Conducting the study in AD-DS patients instead of AD patients will allow us to obtain human data for AD in an orphan subpopulation much faster than in the regular AD population. Concomitantly, our goal is to also conduct a Phase 3 pivotal study in early PD patients. By the end of 2024, we expect to have conducted two pivotal studies for ANVS-401, one in AD-DS and one in PD, and to have filed one or two new drug applications (NDA) with the U.S. Food and Drug Administration (FDA).

Landscape of Drug Development for Alzheimer's Drugs

        Drug development for AD has proven to be very difficult. Five drugs are approved for the treatment of AD including four cholinesterase inhibitors (tacrine, donepezil, rivastigmine, galantamine) and an N-methyl-D-aspartate receptor antagonist (memantine). No new treatments have been approved for AD since 2003. While these drugs ameliorate the symptoms, the ultimate aim is the development of disease modifying therapies (DMT) that stop or slow the progression of AD.

        Since 2003, over 500 clinical studies have been completed and no compound has shown efficacy. AD drug candidates have the highest failure rate of 100%, compared to 50% to 80% for other indications. Among the DMTs the most common pathway has been to target amyloid beta as dictated by the amyloid hypothesis. All studies attacking Ab to date have failed, but since Ab accumulates years before the symptoms of AD are visible, there is a movement in the industry toward treating patients with milder forms of AD including cognitively normal individuals with evidence of amyloid pathology in spinal fluid or by amyloid positron emission tomography (PET) or who have genetic profiles that place them at high risk for developing AD. These approaches have missed their endpoints as shown by the very recent discontinuations of the Roche/ACImmune and the Biogen/Eisai studies. To date, over $40 billion have been spent on dead-end approaches.

        Why have all DMD approaches failed to date? In 1906 Alois Alzheimer opened the brain of a woman that had died with severe dementia and he found plaques, tangles and brain shrinkage. He called the condition Alzheimer's disease. Today we are still calling this condition AD. However, what Alois Alzheimer found was the end stage. Removing plaques and tangles does not restore the brains vigor, communication system and homeostasis.

        What is the beginning of neurodegeneration? It starts out with high levels of neurotoxic proteins that cause impairments in axonal transport.

Innovation

Pipeline

        Our Pipeline consists of ANVS-401 for chronic neurodegeneration—including AD, its orphan indication AD-DS and PD, ANVS-405 to treat acute neurodegeneration—traumatic brain injury (TBI) and stroke—and ANVS-301 for advanced AD.

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ANVS-401

        Our lead compound, ANVS-401 is an orally administered drug being developed for chronic indications such as AD-DS, AD and PD, because in preclinical studies it restoredimproved axonal transport in these diseases by inhibiting the overproduction of neurotoxic proteins that kill nerve cells. The compound was tested in three Phase 1 clinical studies that showed it to be well tolerated. This safety data is applicable to the clinical development of ANVS-401 for AD-DS, AD, PD and other chronic neurodegenerative disorders.

ANVS-405

        For acute indications, we are developing ANVS-405, focused on protecting the brain after TBI and/or stroke. ANVS-405 is the same compound as ANVS-401 but it is given intravenously in cases of acute head and brain trauma. ANVS-405 was given to rats as an injectable after TBI to ensure that it would reach the brain in less than 15 minutes rather than 1.5 hours. TBI rats that were treated with ANVS-405 after the insult exhibited normalenhanced memory and learning and lower microglia activation, a measure of inflammation. Once we are in Phase 3 clinical studies for AD-DS,To date the program has been funded by a grant from the US Army and we plan to raiseseek additional moneygrant funding to pursuefurther the development of ANVS-405 for acute indications of brain and nerve trauma. We plan to conduct a follow-on study to evaluate the effect of ANVS-405 administered to TBI rats at various intervals post-injury to determine how long after a TBI we can effectively treat a patient. We would then seek further funding to conduct the toxicology and pharmacokinetics (PK) studies in animals, file the initial new drug application (IND), conduct the safety and PK studies in humans and continue with Phase 2 and Phase 3 efficacy studies.

ANVS-301

        OurWe are developing our compound ANVS-301 is expected to increase cognitive capability in later stages of AD and dementia. In preclinical studies, ANVS-301 restoredimproved memory and learning in very old rats by lowering the number of errors from six to three and made the old rats cognitively equivalentshortening run times from approximately 75 to young rats.approximately 28 seconds. ANVS-301 is in a Phase 1 clinical trial that is being conducted and financed by the National Institutes of Health (NIH). The single ascending dose study is nearly complete and we, in collaboration with the NIH, are preparing to move into the multiple ascending dose study. When the single and multiple ascending dose safety studies are complete, we will review the data and decide whether to pursue the indication of advanced AD.

Background—What is Neurodegeneration?

        A normal nerve cell receives signals, processes them in the cell body and transports them through the axon, a long-arm nerve fiber that extends out from the cell body and connects to the synapses, or fingers. These fingers then touch the successive nerve cell(s), where the signals are relayed further.

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Nerve Cell with Axon and Synapse

        When brain cells become injured or stressed their first response is reduction and impairment of axonal transport. If the insult persists, axonal vesicle transport remains impaired resulting in decreased levels of neurotransmitters and leading to depression (serotonin), anxiety and insomnia (GABA), AD (acetylcholine) and PD (dopamine). It also results in lower levels of neurotrophic factors and in nerve cells getting sick. When the immune system sees a sick cell, it attempts to remove it, which leads to inflammation in the brain. Eventually, the sick cell is then killed by the immune system.

ANVS-401—Our Solution to Reverse Neurodegeneration

        ANVS-401 is a small lipophilic molecule that is orally available and readily enters the brain, as demonstrated by preclinical pharmacokinetics analyses showing brain concentrations approximately six to eight times higher than plasma concentrations. In different studies we found slightly different ratios because of the time of measurement after administration; on average brain levels are approximately six to eight times higher than plasma concentrations. In preclinical studies, ANVS-401 showed a mechanism of action we believe to be unique, in that it inhibited the translationover-translation of and, therefore, reduced the levels of several key neurotoxic proteins bothin vitro andin vivo, including APP, tau andaSYN. Three Phase 1 clinical studies demonstrated that ANVS-401 was well tolerated. The third proof-of-concept study showed that it also reduced levels of APP, tau andaSYN (aSYN is an unpublished, not stastically significant observation) in the cerebrospinal fluid (CSF) of four MCI patients back to the levels measured in healthy volunteers.patients. Additionally, we now have preclinical data that linked the lowering of neurotoxic proteins to axonal transport improvement and restoration of function. By lowering the levels of neurotoxic proteins in AD transgenic (tg) and DS trisomic mice models, ANVS-401 restoredincreased memory and learning. ANVS-401 also restoredimproved colonic motility in a PD tg mouse model of PD. See pages 89-90.

        By targeting multiple neurotoxic proteins, ANVS-401 resembles a combination therapy approach, with the added convenience of being a single drug with a single drug target. Therefore, we have worked to understand how ANVS-401 is able to inhibit the translation of more than one neurotoxic protein.

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Novel Mechanism of Action and Target Engagement

        We undertook an extensive exploration of the mechanism of action of ANVS-401 on APP andaSYN synthesis and determinedwe concluded that ANVS-401 specifically inhibits translation of mRNAs coding for neurotoxic proteins only. Using 5 different methods we obtained overlapping resultsin vitro. mRNAs of neurotoxic proteins have a conserved stem loop in the 5' untranslated region (5'UTR) called an iron-response element (IRE) type II stem loop. These IREs bind to an RNA binding protein, specifically to iron regulatory protein 1 (IRP1). When the mRNAs are bound, they are not translated, when the iron levels in the cytoplasm go up, IRP1 releases its mRNAs and they are translated.

Target Engagement

        In preclinicalthese in vitro studies, ANVS-401 specifically bound to the IRE/IRP1 complex of mRNAs coding for neurotoxic proteins and stoppedinhibited the release of the mRNAs under high iron conditions. It did not bind to IRE/IRP1 complexes of mRNAs coding for iron carrying or shuttling proteins, such as ferritin transferring or ferroportin or other protein mRNAs.

APP/IRE/IRP1/ ANVS-401 Kd 3.2 nM

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Ferritin IRE/IRP1/ANVS-401 no Kd

        ANVS-401 binds to the APP IRE/IRP1 complex but not to the Ferritin IRE/IRP1 complex

        Since the 5' UTR IRE is highly conserved among the mRNAs of neurotoxic proteins, we believe ANVS-401 can inhibit the translation of several neurotoxic proteins by having just one binding site and by increasing the binding of that conserved IRE to IRP1 under high iron conditions (see graph below). This has been shown for APP andaSYN. We now knowhave data showing that homologous IRE type II loops are also present in the 5'UTR of mRNAs that code for APP andaSYN as well as for other neurotoxic proteins: tau, Prion protein (PrP) and huntingtin (Htt). Furthermore, we have binding data confirming the interaction of IRP1 with the IREs from human APP,aSYN, tau, PrP and Htt (not shown). Finally, we now understandour data shows that ANVS-401 only increases the binding of IREs of neurotoxic proteins to IRP1 under stress conditions, so it does not affect healthy tissue and does not affect other proteins whose mRNAs form a different kind of IRE stem loop (e.g. ferritin).

        In preclinical studies,As discussed above, ANVS-401 inhibited over-expression of neurotoxic proteins by binding to the IRE-IRP1 complex and preventing the opening of IRP1 and concomitant release of the mRNAs under high iron conditions.

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Axonal Transport and Pathway Engagement

        APP, tau, andaSYN impair axonal transport and synaptic transmission, causing inflammation, forming aggregates, and, finally, leading to nerve cell death. Through several studies, discussed below, we have found that, by reducing APP, tau andaSYN levels, ANVS-401 treatment restoredimproved axonal transport and stoppedimpeded the toxic cascade which leads to nerve cell death.

        ANVS-401 is being developed for chronic indications as an oral administered drug. ANVS-405 is the same compound as ANVS-401, but it is given intravenously in cases of acute head and brain trauma. Both modes of administration have shown in animal studies that they lower neurotoxic proteins and inflammation. The difference between ANVS-401 and 405 is not in their mode of action or activity, but in their mode of administration, kinetics and dose. Our pharmacokinetic studies show that in rats,

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injectable ANVS-405 enters the brain in less than 15 minutes, while oral ANVS-401 takes approximately 1.5 hours. Our dosing studies in rats show that the dose of injectable form is about seven times lower than the oral form. Accordingly, we expect their toxicology profiles to be different, with ANVS-405 very likely showing adverse events at much lower doses than ANVS-401. ANVS-401 has been tested in mouse, rat and dog toxicology studies as well as in human safety studies for one month. ANVS-405 was given to rats as an injectable, but for humans it first needs to be formulated into an injectable and the safety must be established in two animal species and in humans before we can study it in human TBI or stroke patients. We plan to continue development of ANVS-405 once we are in Phase 3 clinical studies for AD-DS and we have raised additional money.

Pathway Engagement:

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Studies showed that ANVS-401 lowered levels of neurotoxic proteins:proteins and improved function:



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AD tg mice—restoredlowered levels of APP and its fragments and repairedimproved memory, learning and brain function. The AD tg mice on placebo never learned to find their way in the 7-arm water maze with less than three to four mistakes, whereas the ANVS-401 treated mice found their way with one mistake, just like the healthy wild-type mice.mistake.



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DS trisomic mice—restoredlowered levels of APP and recovered memory and learning. The trisomic mice moved 38% less and made 68%63% more mistakes in the maze whereas thethan healthy wild-type mice. ANVS-401 treated mice performed like healthy wild-typeincreased activity and reduced mistakes of DS trisomic mice.



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PD tg mice—restoredlowered levels ofaSYN in the brain and gut and regulated gut motility. The PD tg mice at four months had four times slower and at seven months had seven times slower gut motility than healthy wild-type mice. ANVS-401 restoredimproved colonic motility back to the colonic motility measured in healthy wild-type mice.motility.



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MCI patients—in four patients, lowered levels of APP and tau andstastically significantly.aSYN back to the levels seen in healthy volunteers.showed a downward trend.



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Studies showed that ANVS-401 improved retrograde and anterograde axonal transport:



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DS trisomic mice nerve cells—in studies conducted at UCSD, inhibition of APP levels led to restoration of anterograde and retrograde vesicle transport. ANVS-401 treatment of the DS nerve cells resulted in an increase in transport velocity of 70%, a value comparable to the velocity seen in normal neurons.. ANVS-401 also decreased the pause time by 29%, again bringing it to the same pause time as in healthy normal cells.. This was measuredin vitro in isolated fully differentiated DS nerve cells.



•

Studies showed that ANVS-401 increased synaptic transmission in:



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AD tg mice—A Columbia University study showed that the AD tg mice treated with ANVS-401 had normalsimilar long-term potentiation as healthy wild-type mice, whereas long-term potentiation of the placebo treated AD tg mice was markedly reduced.



•

Studies showed that ANVS-401 increased levels of neurogenesis:



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AD tg mice brains—Two studies by the Karolinska Institute measured stem cell and nerve cell differentiation. One study found that ANVS-401 treatment increased stem cell differentiation into nerve cells by 40% in the hippocampus. The second study showed that while the data was variable and dependent on age of the mice and area of the brain, treatment with ANVS-401 improved synaptic function by modulating the maturation and plasticity of newborn neurons.

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•

Studies showed that ANVS-401 and/or ANVS-405 lowered inflammation in:



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MCI patients—In a proof of concept clinical trial, all four MCI patients treated with ANVS-401 who completed the trial showed a reduction in inflammatory factors.



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TBI rats—rats with traumatic brain injury had much larger microglia than normal rats. Enlarged microglia means that the microglia are activated and shows inflammation. After treatmentTBI rats treated with ANVS-405 the size of thehad smaller microglia, shrank back to the size seen in healthy normal rat brain.showing lower inflammation.



•

Studies showed that ANVS-405 protected nerve cells in:



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TBI rats—A UCLA study stained the rat substantia nigra with a fluorescent probe. This probe, TH-immunoreactivity, binds to live cells, while dead cells do not stain. Therefore, the fluorescent signal is a surrogate marker for deadlive cells. They found that afterRats were subjected to either TBI theor to a sham, i.e., mock surgery (non-TBI rats). TBI rats treated with a placebo treated rats showed approximately 40% less fluorescence meaning that approximately 40%than non-TBI rats, while TBI rats treated with ANVS-405 showed fluorescence of the cells had died. In ANVS-405 treated rats the nerve cells' stain signal was substantially the same100% or more as for sham treated animals.compared to non-TBI rats.



•

Retina rats—In a Hershey Medical Center unpublished study that mimics acute glaucoma in which saline was injected into one eye to increase the pressure, which kills retinal cells, ANVS-405 protected 67% of the retina.

        By lowering levels of neurotoxic proteins, ANVS-401 and ANVS-405 improved functions in all diseasesanimal models we tested. These functions are: memory, learning fear conditioning and long-term potentiation in AD mice; memory, learning and learningaxonal transport in DS mice; gut and gait function in PD mice; memory and learning in TBI rats; and sight in acute glaucoma rats.

        Collectively, we believe these effects make ANVS-401 a very promising drug for the treatment of memory loss and dementia in AD-DS and AD and bodily and brain functions in PD.

        Impact: Our goal, in our Phase 2a studies in AD and PD patients, is to demonstrate that ANVS-401 is well tolerated and is able to normalizelower the CSF levels of neurotoxic proteins (at least APP, tau, andaSYN) and inflammatory markers, as previously seen in clinical and preclinical studies. In these studies, we are also planning to analyze the CSF levels for additional neurotoxic proteins, control proteins lacking the conserved mRNA sequence of neurotoxic proteins, as well as neurotransmitters, neurotrophic factors, degeneration markers, and cognitive outcomes. Thus, we expect that we will be able to identify biomarkers for use in later studies.

ANVS-401—How was it discovered?

        ANVS-401 is a small orally available molecule that readily passes the blood brain barrier and reaches high brain levels. It is the only molecule discovered to date that inhibits more than one neurotoxic protein and restores axonal transport, synaptic function and nerve cell health.

        It was synthesized and invented by Dr. Nigel Greig at the National Institute on Aging (NIA) of the National Institutes of Health (NIH), which is a part of the U.S. Public Health Service (PHS). Originally Dr. Greig set out to make a better acetylcholinesterase inhibitor (AChEI), similar to Aricept but better. He discovered over 500 analogs of physostigmine and chose phenserine as the best AChEI. Phenserine had an affinity for AChE of 22 nM and was an improvement over Aricept with 900 nM. Axonyx, Inc. licensed phenserine and developed it as an AChEI through three Phase 3 studies that all failed. Even though a potent AChEI, phenserine had caused severe vomiting.

        Dr. Greig also synthesized a group of analogs that had no acetylcholinesterase activity, which were of no importance to him at that time. Ten years later a friend of his, Debomoy Lahiri, told him that he had developed a phenotypic screen for APP inhibition and Dr. Greig gave him all his compounds, both those with and without AChEI activity. It turned out that the group that had no AChEI activity did inhibit APP in the screen. As it looked like the analogs had similar affinity for APP inhibition, Dr. Greig chose ANVS-401, the positive enantiomer of phenserine, as the lead compound.

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        Dr. Greig patented the new group of compounds and licensed them to Axonyx Inc. He published extensively and patented his inventions.

        Axonyx Inc. conducted preclinical toxicology studies in three animal species (mice, rats and dogs), conducted pharmacokinetic studies and pharmacodynamic studies in several animal species, manufactured adequate amounts of GMP material, and filed an investigational new drug applicationIND with the FDA. In 2006 phenserine failed and Axonyx merged with TorreyPines Therapeutics, Inc., which merged with Raptor Pharmaceuticals, Inc. in 2009. Raptor Pharmaceuticals was acquired by Horizon Therapeutics PLC in 2016. Currently, the technology is co-owned by a subsidiary of Horizon and the PHS and Annovis has exclusive worldwide rights to the technology.

        In summary the (–) enantiomers including phenserine are symptomatic AChEIs, whereas the (+) enantiomers including ANVS-401 have no AChEI activity and inhibit the translation of neurotoxic proteins, such as APP/Ab, tau/p-tau andaSYN and protect nerve cells from dying. They are expected to be DMDs and change the course of neurodegeneration.

        The toxicology studies which were completed in mice, rats and dogs lasted 30 days. With 30 days of animal safety data we can treat humans, whether healthy volunteers or patients for 30 days. For us to conduct a two-year clinical study, the FDA requires the completion of two animal toxicology studies—a six-month study in rats and a nine-month study in dogs. The successful completion of those toxicology studies is a prerequisite for us to start our planned Phase 3 studies in AD-DS and PD.

Clinical Human Data

        Three clinical studies have been conducted with ANVS-401. Clinical studies with single and repeated daily oral administration of ANVS-401 tartrate showed ANVS-401 to be well tolerated up to doses of 80 mg once a day or 60 mg four times a day. A single dose of 160 mg was associated with an increased incidence of nausea and vomiting so higher doses were not tested. ANVS-401 is not an AChE inhibitor, but its N¹ dimethyl metabolite (10-20%) has some AChE inhibitor activity and may be responsible for these observations. The only consistent adverse events (AEs) seen were dizziness/fainting and headaches. These effects were seen to varying degrees at all doses of ANVS-401 and in the placebo group. There were no serious AEs in any of the clinical studies.

        The key findings from the three clinical studies are highlighted below.

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Single ascending dose (SAD) in 72 healthy volunteers including placebo

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Drug determined to be well-tolerated, with no AEs at 80 mg with a maximum tolerated dose (MTD) of 160 mg





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Dose limiting toxicity was nausea





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Multiple ascending doses (MAD) in 48 healthy volunteers including placebo

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Drug determined to be well-tolerated with no AEs and no symptoms indicative of inhibition of either acetyl- or butyryl cholinesterase at doses up to 240 mg/day (60 mg four times a day)





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Proof of Concept (POC) in fivefour MCI patients

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Concentrations of ANVS-401 in the brain, extrapolated from blood and CSF, were eight times higher than in plasma

The half-life of ANVS-401 in the CSF/brain was over 12 hours vs. five hours in plasma

Ten days of treatment with



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ANVS-401 lowered CSF levels of APP, tauneurotoxic proteins andaSYN down to inflammatory markers. See pages 94 and 95.

        In the levels seen in four healthy volunteers not treated withMCI patients, ANVS-401 and lowered four inflammatory markers

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The concentration and persistence of ANVS-401 in the brain suggest that much lower doses of drug administered once daily could achieve the desired pharmacodynamic effect

Summary of Pharmacokinetics (PK) in Humans

ANVS-401 is stable, orally available and hashad a half-life of five hours in plasma and more than 12 hours in CSF. It is well qualified as an oral development candidate.The longer concentration and persistence of ANVS-401 in the brain suggest that




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much lower doses of drug administered once daily could achieve the desired pharmacodynamic effect. T_max was 1.3–1.6 hours post dose, independent of dose and comparable for both sexes in plasma and CSF. ANVS-401 is stable, orally available and enters the brain, therefore we are developing it as an oral drug candidate.

Summary of Safety in Humans

        ANVS-401's pattern of AEs was similar to that seen in typical studies in healthy volunteers, with an overall incidence of 33.3% among placebo-treated subjects and 35% for all ANVS-401 treatment groups combined. In the single ascending dose study, the group given the highest dose of 160 mg/day showed 31.7% AEs that were treatment-related. In the multiple ascending dose and in the POC study there was no dose response to the adverse events. Most AEs were of short duration, mild or moderate in severity, resolved without medical intervention, and occurred in one or a few subjects. Only two subjects experienced severe AEs, including symptoms associated with orthostatic hypotension (one placebo and one ANVS-401 20-mg subject).

Adverse events seen in the first human SAD study conducted with ANVS-401

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Adverse events seen in the second and third human MAD and POC studies conducted with ANVS-401

POC in Humans

        In the human POC study, fivefour patients with MCI were treated for 10 days with ANVS-401 with a dose of 60 mg four times a day (240 mg/day), which we knew from our MAD study to be a well tolerated level. One of the patients dropped out after two doses and four patients completed the study. CSF and plasma were drawn over 12 hours on dayDay 0 before any administration of ANVS-401 and day 11. Levelson Day 11 after the last administration of ANVS-401. During each 12-hour period, a total of nine CSF samples were taken and levels of ANVS-401 and metabolites were measured in plasma and CSF over the 12 hours.at all time points.

Pharmacokinetics

        ANVS-401 PKpharmacokinetics (PK) in plasma corresponded to what the Companywe had seen in the previous clinical safety studies: a half-life of five hours. In CSF, however, ANVS-401 showed a much longer half-life of over 12 hours. AnnovisWe conducted an identical experiment in rats, where it is possible to measure the PK of ANVS-401 in plasma, CSF and brain. By taking the human plasma/CSF and rat plasma/CSF/brain levels, Annovis waswe were able to extrapolate to the human brain levels and calculate them to be eight times higher than plasma levels. This is consistent with the data the Company haswe have in mice, where in several studies, ANVS-401 levels were found to be approximately six to eight times higher in brain than in plasma.

        ANVS-401's extended presence in the brain is matched by an extended effect, reducing levels of APP, tau andaSYN for the whole period tested (12 hours). The extended effect of ANVS-401 in humansthe four human patients was consistent with the preclinical data in rodent brains.

        The persistence of ANVS-401 in the CSF and brain and the extended pharmacodynamic effect observed make ANVS-401 a good candidate for once a day dosing. Extrapolated brain levels of ANVS-401 at 60 mg four times a day were far in excess of levels we believe are required to down-regulate APP andaSYN. The doses of ANVS-401 needed to lower the levels of neurotoxic proteins are similar for the toxic proteins, suggesting similar dosing in AD, AD-DS and PD. AnnovisWe further compared ANVS-401 brain levels of mice that showed full reversal of their AD or PD symptomsimproved memory, learning and colonic motility and calculated that the optimum brain levels measured were between 150 and 500 nM. Using three different extrapolation/comparison calculations the Companywe calculated that a daily dose of 5mg to 60 mg should achieve potentially desired brain levels in humans.

Table of Contents

Pharmacodynamics

        ANVS-401 pharmacodynamics was performed on the same 18 CSF samples taken from each person as above. Since we had data for four patients with 18 time points each, it was possible to conduct statistical analysis of the data using a repeated measure mixed model analysis of variance. The p-value represents the probability that the difference between compared groups is due to chance rather than drug effect, and when that probability is less than 5%, or p<0.05, the result is considered statistically significant. FDA evidentiary standards for drug approval require that the trial design must permit a valid comparison with a control group to permit a quantitative assessment of the effect of the drug, which may include demonstration of statistical significance.

CSF BIOMARKERS DECREASE AFTER 10 DAYS OF ORAL ANVS-401 IN FOUR MCI PATIENTS

        MCI patients showed high levels of sAPP, tau andaSYN in their CSF. They were treated for 10 days with ANVS-401 and their CSF was extractedanalyzed for 12 hours before and after the last administration of ANVS-401.neurotoxic proteins. In all four patients, who completed the trial, the levels of neurotoxic proteins decreased by between 35% and 65%, with an average of approximately 50%.decreased. The levels measuredpercentages shown in the table were calculated using all nine time points after ANVS-401 treatment were similarcompared to all nine time points prior to treatment. Due to the levels measuredvariability in four healthy volunteers thatthe CSF measurements of sAPPa, sAPPb, Ab42 and tau, we had not received ANVS-401.all samples analyzed by two different laboratories using different methodologies.

Inflammation

        The same CSF INFLAMMATORY MARKERS AFTER 10 DAYS OF ORAL ANVS-401 IN MCI PATIENTS

MCI patientssamples were also show high levels ofanalyzed for inflammatory factors and microglia activation factors inas well as a control factor. All patients reacted by lowering their CSF. In all patients ANVS-401 significantly lowered the levels of two inflammatory markers—markers and not lowering the level of the control protein.

        The statistical analysis again was performed with a repeated measure mixed model analysis of variance. Three inflammatory markers were lowered to a statistically significant level: Complement C3, was lowered by 86.9% with a statistical significance of 0.0007MCP-1 and MCP-1 was lowered by 87.5% also with a statistical significance of 0.0007.YKL-40. The other twofourth inflammatory factorsmarker, sCD14, showed a downward trend. We also measured Factor FH, is a complement regulatory protein involved in blood clotting, which served as our control factor. As we had expected, Factor FH was not downregulated by ANVS-401.

CSF INFLAMMATORY MARKERS AFTER 10 DAYS OF ORAL ANVS-401 IN FOUR MCI PATIENTS