Addex Therapeutics Navigates Transition with Neurosterix Deal, but Challenges Remain

Addex Therapeutics (ADXN) has undergone a pivotal transformation in 2024, pivoting from a traditional biotech research model to a more diversified portfolio strategy through its partnership with Neurosterix. The year brought both financial relief and strategic realignment, but lingering operational losses and market risks underscore the fine line between progress and uncertainty.

The Neurosterix Deal: A Lifeline or a Gamble?

The launch of Neurosterix LLC, backed by $65 million in Series A funding from Perceptive Advisors, marks a turning point for Addex. The collaboration enabled Addex to offload its allosteric modulator platform—central to its preclinical pipeline—and secure an immediate $5 million cash injection and a 20% equity stake in the new entity. This move, classified as a discontinued operation under IFRS, generated a CHF 13.9 million net gain, transforming Addex’s bottom line.

However, the equity stake also exposed Addex to Neurosterix’s operational losses, contributing to a CHF 2.177 million net loss in continuing operations. While the transaction bolstered shareholders’ equity to CHF 9.7 million (up from CHF 1.1 million in 2023), the ongoing reliance on Neurosterix’s success raises questions about Addex’s ability to sustain this new model.

Financial Performance: A Mixed Picture

Addex’s 2024 financial results reveal both strengths and vulnerabilities. Total net profit surged to CHF 7.056 million, a stark reversal from a CHF 10.556 million net loss in 2023, driven entirely by the Neurosterix gain. Yet, core operations remain strained:
- Income fell 75% to CHF 0.4 million as the Indivior collaboration concluded, ending a key revenue stream.
- R&D expenses dropped to CHF 0.85 million, reflecting reduced activity post-Indivior, but general and administrative costs stayed elevated at CHF 2.3 million.
- Cash reserves dipped to CHF 3.3 million, down CHF 0.6 million from 2023, signaling a need for future funding.

Market reaction has been muted, with shares trading near all-time lows, suggesting skepticism about the company’s path to profitability.

Pipeline Repositioning: Betting on Neurorecovery

Addex’s strategic shift is most evident in its pipeline repositioning:
1. Dipraglurant, previously stalled in Phase 2 trials for epilepsy, is now targeted at brain injury recovery—a high-unmet-need space with potential for accelerated approval.
2. ADX71149, a Phase 2 asset regained from a former partner, offers flexibility to explore new indications or partnerships.
3. The independent GABAB PAM program for chronic cough targets a niche market with limited treatments, potentially offering a faster path to commercialization than broader SUD indications pursued by Indivior.

These moves align with Addex’s focus on neurological disorders, a theme amplified by Neurosterix’s preclinical programs in schizophrenia, mood disorders, and neurocognitive conditions.

Risks and Outlook

While the Neurosterix deal provided immediate financial relief, Addex faces critical hurdles:
- Cash Constraints: With CHF 3.3 million in reserves and ongoing losses, the company may need additional funding within 12–18 months.
- Dependency on Partners: Success hinges on Neurosterix’s preclinical progress and Indivior’s SUD candidate, over which Addex has limited control.
- Clinical Uncertainty: Repositioning dipraglurant into brain injury recovery carries scientific and regulatory risks, particularly in proving efficacy in late-stage trials.

Conclusion: A High-Reward, High-Risk Gamble

Addex’s 2024 results reflect a calculated gamble: leveraging strategic partnerships to diversify its portfolio while shedding costly R&D. The Neurosterix transaction provided a much-needed cash infusion and equity upside, but the company’s ability to turn its core operations profitable remains unproven.

Key data points underscore the duality of its position:
- Net profit (total): CHF 7.056 million (vs. a loss of CHF 10.556 million in 2023)
- Cash burn rate: ~CHF 0.6 million annually (based on 2023–2024 reserves)
- Pipeline focus: 3 late-stage candidates (dipraglurant, ADX71149, GABAB PAM) targeting underserved neurological niches

Investors must weigh the potential of these assets against execution risks. For those willing to bet on Addex’s repositioning strategy, the stock offers high upside if Neurosterix’s programs advance or dipraglurant gains regulatory traction. However, the reliance on external partners and thin cash reserves leave little room for error—a reality that may keep the stock volatile in the near term.

In a sector where biotech survival often hinges on capital efficiency and partnership leverage, Addex’s 2024 moves set the stage for a decisive 2025. The next 12 months will test whether this pivot can translate into sustainable value—or prove to be a costly detour.