Annexon, Inc. Annual Report - How They Did This Year

I’ve put together this guide to help you understand how Annexon, Inc. performed this year. Think of this as a "cheat sheet" to help you decide if this company fits your investment goals.

1. What does this company do?

Annexon is a clinical-stage biopharmaceutical company. They research new medicines for diseases where the immune system goes into "overdrive" and accidentally damages the body, brain, or eyes.

They focus on a part of the immune system called the "classical complement pathway." By targeting the C1q protein, they aim to stop inflammatory damage. Because they are still testing their drugs, they have no products on pharmacy shelves and reported $0 in sales for the year ending December 31, 2025.

2. Financial health: The "Burn"

Since Annexon isn't selling drugs, they don't have a profit. Instead, they are in a heavy spending phase, using cash to fund expensive clinical trials.

For 2025, the company reported a loss of about $248.5 million. Most of this went toward $198.2 million in research and development. As of December 31, 2025, the company held $365.4 million in cash and investments. Management expects this to fund operations into the second half of 2027.

A critical detail: As of March 2026, the company had over 160 million shares outstanding, plus 37.8 million "pre-funded warrants." These warrants allow holders to buy more shares for a tiny price. If exercised, these create more shares, which reduces your ownership percentage—essentially giving you a smaller slice of the pie.

3. Major wins and the "Pipeline"

Annexon is racing to get two major drugs approved:

• Tanruprubart (ANX005): A potential treatment for Guillain-Barré Syndrome, a dangerous nerve condition. They completed a successful Phase 3 trial where patients showed improved muscle strength. They have filed for approval in the EU and are preparing a U.S. FDA application for 2026.
• Vonaprument (ANX007): A drug for "dry" age-related macular degeneration, a leading cause of blindness. They are running a large Phase 3 trial with 659 patients. Results are expected in late 2026. This test will determine if they can slow the growth of lesions in the eye.

They are also developing an oral pill (ANX1502) for autoimmune conditions. They reported safety data in 2025 and are planning the next steps for testing.

4. Key risks: What could hurt your investment?

• The "Cash Crunch": With no sales, they rely on selling more stock to stay afloat. In 2025, they raised $250 million by selling more shares. This constant need for cash leads to the ownership dilution mentioned earlier.
• Trial Failure: Their value is tied to their research. If the trial for their eye drug fails, the stock price could drop significantly.
• Regulatory Hurdles: The FDA or European regulators may demand more testing. This would increase costs and delay potential sales.
• Competition: They face well-funded rivals like Apellis and Roche. If a competitor offers a better or more convenient treatment, Annexon’s potential will be limited.

5. The Bottom Line

Annexon is a high-risk, high-reward bet. You aren't investing in a company with steady sales; you are investing in the potential of their research. If their 2026 trial results are positive, it could be a breakthrough. Until then, expect the company to keep spending cash and potentially issuing more shares to fund their work.

Investor Tip: Before buying, ask yourself if you are comfortable with the "binary" nature of this stock—where the price is likely to swing wildly based on upcoming clinical trial results rather than current revenue. If you prefer stability, this may not be the right fit for your portfolio.