Ovid Therapeutics Inc. Annual Report - An Investor's Summary

This summary provides a clear, comprehensive overview of Ovid Therapeutics' annual report for the year ending December 31, 2025. It highlights the company's financial health, strategic direction, and key considerations for investors.

1. Business Overview

Ovid Therapeutics focuses on developing novel therapies for rare neurological diseases, addressing significant unmet medical needs. The company operates as a "Smaller Reporting Company," meaning it has fewer regulatory reporting requirements than larger firms. While this can streamline operations, it often signals a higher risk profile due to its smaller scale and potentially greater sensitivity to market fluctuations.

As of June 30, 2025, the market value of Ovid's publicly traded shares, known as its "public float," was approximately $22.2 million. This figure is from mid-2025 and may not reflect the company's current total market capitalization. As of March 16, 2026, Ovid had 131,874,634 shares of common stock outstanding.

2. Financial Performance

For the fiscal year 2025, Ovid Therapeutics reported the following key financial figures:

• Revenue: Ovid generated $5.3 million in revenue, primarily from collaboration agreements. This indicates the company's income largely depends on partnerships, not direct product sales.
• Net Loss: Ovid reported a net loss of $40.1 million. This is common for clinical-stage biotech companies that heavily invest in research and development (R&D) before bringing products to market.
• Research & Development (R&D) Expenses: The company invested $30.5 million in R&D, reflecting its ongoing efforts to advance its drug pipeline.

3. Risk Factors

Investing in Ovid Therapeutics, like many biotech companies, involves specific risks that investors should consider:

• Clinical Trial Success: Ovid's drug candidates' success depends heavily on positive outcomes from clinical trials. Failure at any stage could significantly impact the company's value.
• Regulatory Approval: Even successful clinical trials do not guarantee regulatory approval from bodies like the FDA. The approval process is complex and uncertain.
• Funding Needs & Dilution: Ovid operates at a net loss and relies on external financing. Future capital raises may dilute existing shareholders' ownership.
• Competition: The rare neurological disease space is competitive, with other companies developing similar or alternative treatments.
• Intellectual Property: Protecting its intellectual property is critical for Ovid's long-term success.

4. Management Discussion and Analysis (MD&A) Highlights

Management's discussion highlights the company's operational results and financial condition. Ovid's $5.3 million in revenue for 2025, primarily from collaboration agreements, underscores its strategy of using partnerships to fund development. The $40.1 million net loss and $30.5 million in R&D expenses reflect the substantial investment required for a clinical-stage biotechnology company focused on drug discovery and development.

To support these operations and R&D efforts, Ovid actively raised capital:

• In October 2025, a private placement raised approximately $15.0 million in gross proceeds. This included CEO participation and involved issuing common stock and warrants.
• After year-end, in March 2026, Ovid raised an additional $10.0 million by selling common stock and prefunded warrants.

These capital raises are crucial for funding ongoing research, advancing its clinical pipeline, covering general corporate expenses, and addressing the company's substantial cash burn.

Ovid's strategy heavily relies on its drug candidate pipeline and strategic collaborations. Key partnerships include:

• Gensaic Inc. (gene therapy research)
• Graviton Bioscience Corporation
• Marinus Pharmaceuticals Inc.
• Takeda Pharmaceutical Company Limited (e.g., for OV101 for Angelman syndrome)
• A license agreement with Northwestern University

These collaborations are vital for sharing development costs, accessing specialized expertise, and potentially accelerating drug candidates' path to market. The success of these collaborations directly impacts Ovid's ability to bring new treatments to patients and generate future revenue. Management continues to advance its lead drug candidates through clinical development and explore new therapeutic areas through these strategic alliances.

5. Financial Health

As of December 31, 2025, Ovid held $25.8 million in cash and cash equivalents. Given its current cash burn rate, this cash position, combined with subsequent financing (including the $10.0 million raised in March 2026), is projected to fund operations into late 2027.

To support its operations and R&D efforts, Ovid engaged in significant fundraising activities:

• Private Placement (October 2025): In October 2025, Ovid completed a private placement, raising approximately $15.0 million in gross proceeds. This involved selling new common stock shares and "warrants" directly to select investors, including its CEO. Warrants give holders the right, but not the obligation, to buy additional shares at a set price in the future, which could dilute existing shareholders if exercised.
• Subsequent Equity Event (March 2026): After year-end, in March 2026, Ovid completed another financing, raising an additional $10.0 million by selling common stock and "prefunded warrants." Prefunded warrants resemble regular warrants but typically have a nominal exercise price because most of the purchase price is paid upfront.

6. Future Outlook

Ovid Therapeutics actively advances its lead drug candidates through clinical development and explores new therapeutic areas through strategic partnerships. The company's financial health is closely tied to its ability to secure additional funding, achieve positive clinical trial results, and navigate the complex regulatory landscape. Investors should closely monitor Ovid's pipeline progress, cash burn, and collaboration outcomes. The company's strategy involves continued investment in R&D, leveraging collaborations to mitigate risk and expand therapeutic reach, and managing its capital resources to extend its operational runway.

7. Competitive Position

Ovid Therapeutics operates in a highly competitive rare neurological disease space. Numerous pharmaceutical and biotechnology companies, academic institutions, and other research organizations discover, develop, and commercialize treatments for similar conditions.

Ovid's competitive position stems from its focus on novel therapies for specific rare neurological diseases, addressing significant unmet medical needs. The company differentiates itself through its scientific approach, the potential efficacy and safety profiles of its drug candidates, and strategic partnerships that provide access to specialized expertise and resources. Its intellectual property portfolio is also a critical component of its competitive strategy.

However, as a "Smaller Reporting Company" with a smaller scale, Ovid faces resource challenges compared to larger, more established competitors. Its success in this competitive landscape will depend on its ability to advance its pipeline, secure regulatory approvals, and effectively commercialize any approved products.