Good afternoon, ladies and gentlemen, and welcome to the NRx Pharmaceuticals Third Quarter 2024 Earnings Conference Call. At this time, all lines are in the listen-only mode. Following the presentation, we will conduct a question-and-answer session. This call is being recorded on Monday, November 18, 2024. I would now like to turn the conference over to Mr. Matthew Duffy, Chief Business Officer. Please go ahead.

Thank you, and welcome, everyone. Before we proceed with the call, I would like to remind everyone that certain statements made during this call are forward-looking statements under U.S. Federal Securities Laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations. Additional information concerning factors that could cause actual results to differ from statements made on this call is contained in our periodic reports filed with the SEC. The forward-looking statements made during this call speak only as of the date hereof, and the company undertakes no obligation to update or revise the forward-looking statements. Information presented on this call is also contained in the press release issued last week as well as the Form 10-Q, which may be accessed from the Investors page of the NRx Pharmaceuticals website. Joining me today on the call are Dr. Jonathan Javitt, our Founder, Chairman and CEO and Chief Scientist; as well as Richard Narido, our Interim Chief Financial Officer and Treasurer; and Michael Abrams, our incoming CFO. Jonathan will provide a summary of our company's progress, Rich will review the company's financial results, Mike will make some comments, and then Jonathan will review our upcoming milestones before making closing comments. Following our prepared remarks, we will address investor questions. I'll now turn the call over to Jonathan.

Thank you, Matt. Good evening, everyone, and thank you for joining us. We chose to hold our conference call shortly after our quarterly report to better accommodate the growing number of analysts following our company and to include today's significant news. The past few months have been highly productive for NRx and Hope Therapeutics, marking a positive turning point in our journey towards market entry and profitability. Regarding NRx, we are progressing with our life-saving products, NRX-100, which is our IV ketamine, and NRX-101, our oral treatment for suicidal bipolar depression, preparing for new drug application filings in 2024. Additionally, our wholly-owned subsidiary, Hope Therapeutics, is set to provide crucial care to those suffering from suicidal depression and PTSD by the end of the year, with its first revenues expected. Hope has entered into nonbinding letters of intent to acquire two key interventional psychiatry groups that are currently generating revenues and are EBITDA positive. We have received initial nonbinding commitments from lenders for non-dilutive acquisition financing for Hope clinics and are nearing the final stages of the underwriting process. This positions NRx uniquely as the only company focused on creating a comprehensive care approach for suicide prevention and treatment. We understand the importance of complementing drug development with a care delivery model, especially as evidence suggests that ketamine alone may not provide lasting benefits for those with suicidal depression. For some patients, our precision psychiatry method, which includes ketamine, transcranial magnetic stimulation, and other therapies, is essential. This care model can be hard to access for many and is not typically available at standard ketamine clinics. By establishing this all-encompassing approach and expanding it nationwide, we can achieve our mission of bringing hope to life. Simultaneously, the Hope clinics can generate revenues that will support NRx ahead of FDA approval for our groundbreaking medicines. Today, we are pleased to announce the appointment of Mr. Michael Abrams as our new Chief Financial Officer. Mike brings nearly thirty years of experience as an executive officer, investment banker, director, and adviser, including his role as CFO of Arch Therapeutics, RiseIT Solutions, and FitLife Brands. He has extensive expertise in areas such as financial operations, accounting, mergers and acquisitions, financial engineering, capital raising, and shareholder communications. Mike holds an MBA with honors from the Booth School of Business at the University of Chicago and a BBA with honors from the University of Massachusetts, Amherst, as a William F. Field alumni scholar. Rich Narido has served as an inspiration as our interim CFO and will continue to support our Hope Therapeutics acquisitions. Until we finalize those initial acquisitions, Dr. David Feifel, the Founder and President of Kadima clinic in La Jolla, California, has joined us as a key adviser. Dr. Feifel is a renowned expert in using precision psychiatry for treating suicidal depression and PTSD, and he was among the first to successfully use ketamine outside traditional university psychiatry clinics in an outpatient setting. He will collaborate with leading psychiatry professors at prominent institutions to help advance our medicines through the FDA and the European Medicines Agency while launching our network of Hope clinics. On the financial front, we are pleased to share that last quarter, we achieved a 74% reduction in net operating losses compared to the third quarter of 2023, and we're forecasting profitability in 2025 with revenue and EBITDA from Hope Therapeutics, along with projected sales of our medications. Further, we recently announced the closing of our second tranche of funding from an institutional investor, bringing the total amount of funding to $10.8 million. In connection with this financing, we retired our prior and more expensive debt and settled outstanding litigation. Collectively, these actions position us to enter the next business stage for the company in 2025, with two potential drug approvals to make us a revenue-generating biotechnology company as well as an EBITDA positive care delivery company. In summary, we are building a company that is now poised to bring life-saving treatment to patients and financial returns to investors. What drives this mission for the NRx team is simple: suicidality is a national epidemic. Approximately 3.8 million Americans make an active plan to commit suicide each year, according to the CDC. An American dies from suicide every 11 minutes in the United States, and worldwide, someone dies by suicide every minute. Our overriding goal at NRx is to ensure that all patients who need life-saving precision psychiatric care with ketamine and other therapies are able to get it. That's not currently the case. For the most part, ketamine is available today only to those who can pay out of pocket and will remain so until FDA approval of ketamine for treating suicidal depression is obtained. Our planned NDA, if approved, would bring NRX-100, clearly a life-saving product, to patients in a safe, accessible format as a preservative-free formulation that has insurance coverage. The current market for intranasal ketamine is already approximately $1 billion a year, and the label for intranasal ketamine states that it has not demonstrated anti-suicidal properties. Let's talk specifically about what we need to do to bring the NRX-100 through the FDA. Originally, the FDA granted us Fast Track designation for NRX-100 in 2017 for use in combination with NRX-101 to treat bipolar depression. We've now asked the FDA to expand that Fast Track designation and grant priority review to our NDA for use of NRX-100 in all forms of depression, including bipolar depression. To get a new drug approved, a manufacturer must demonstrate efficacy, safety, and manufacturability. The slides on nrxpharma.com summarize the data we will be sharing with the FDA that includes nearly 1,000 patients treated in randomized controlled trials against placebo, active comparator, and electroshock therapy. In summary, intravenous ketamine is far more effective than both placebo and active comparator in treating suicidal depression. It is noninferior to and may, in fact, be superior to electroshock therapy without the memory loss caused by ECT. The patients treated in randomized trials are supplemented by data on more than 20,000 patients treated in the real-world setting, where a 50% reduction in depression scores is seen. Last June, the aggregator of those data reported results from intravenous ketamine were superior to those seen with intranasal esketamine, although that real-world comparison was not based on a randomized trial. A key component of any new drug application is a comprehensive chemistry, manufacturing, and control or CMC package, also known as Module 3. In our last conference call, we pointed to this requirement into our nine month stability data. We've now completed this requirement with the 12-month stability data required to file an application for new drug approval. Another key requirement for the FDA to file an NDA is alignment on a pediatric study plan as required by law. As noted previously, we've reached this critical alignment with the FDA, and I would like to commend the clinical regulatory team at NRx for achieving this milestone. Our development of a preservative-free ketamine may be surprising to some. The basis for this development path is the result of data from both primate and human studies that show repeated doses on the order of 60 doses or more of the currently available commercial intravenous ketamine may be toxic to the brain. The currently available ketamine preparation was designed for use of the product in anesthesia. Ketamine is currently sold in a multi-dose vial, where it was anticipated that doctors would draw from the same vial for multiple patients. But of course, in anesthesia, it's expected that the patient will only get the medicine once. Back in the 1960s, when this preparation was formulated, it was manufactured with a potentially toxic preservative. While there is no evidence that benzanthonium chloride is toxic at its current concentration for the intended use in anesthesia, its safety has never been shown or even proposed for repeated use. Hence, we believe we are poised to file the first new drug application for a novel preparation of ketamine that will bring substantial value to patients and will be reimbursable by payers. Access to NRX-100 is a critical focus of our company. The current off-label use of ketamine in CNS disorders is generally only available to patients who can pay out of pocket. We expect NRX-101, once approved, to be widely reimbursed, thus providing access to the vast majority of people in need, not just to those with the means to spend thousands of dollars in cash for treatment. Let's turn to NRX-101, our oral combination of D-cycloserine, which is an NMDA blocker, and lurasidone, which is the standard of care in bipolar depression. We believe the product represents a paradigm-changing breakthrough in the care of bipolar depression. This breakthrough is driven by a dramatic improvement in the safety of our medicine compared to the standard of care in bipolar depression in clinical trials. In our recently completed clinical trial, we demonstrated that NRX-101 is comparable in its ability to reduce symptoms of depression when compared to the market-leading drug, lurasidone. Critically, however, NRX-101 demonstrated that it's the first and only oral antidepressant to reduce symptoms of suicidality and the first oral antidepressant to reduce symptoms of akathisia, a highly dangerous side effect of nearly all antidepressants. The NRX-101 data presented at the American Society of Clinical Psychopharmacology demonstrated a new paradigm for the treatment of bipolar depression. Now akathisia is not a household term. However, key opinion leaders regard it as the worst side effect of any antidepressant. Akathisia is frequently described as an irresistible urge to move. Patients frequently describe it as a feeling of jumping out of their skins. Patients with akathisia are known to jump off roofs and in front of oncoming trains. Currently, there is a petition before the Supreme Court of British Columbia regarding a Canadian citizen who has applied to end her life by medically assisted suicide because she cannot tolerate the akathisia caused by common antidepressant medication. Serotonin-targeted drugs for the treatment of depression are known to cause akathisia and suicidality. Doctors and patients have lived with those side effects in order to achieve the critical antidepressant effects that are needed to control life-threatening depression. The data we presented at ASCP, however, confirms data from our earlier STABIL-B trial demonstrating that NRX-101 is the first oral antidepressant to have effective antidepressant properties while simultaneously decreasing akathisia and suicidality. We believe this product profile could lead to NRX-101 becoming the drug of choice in bipolar depression. To that end, we're filing an NDA for accelerated approval of NRX-101 for suicidal bipolar depression with suicidality or akathisia. Given our strong data and the lack of treatment options for this segment of people with bipolar depression, we and our regulatory counsel believe this to be a vital unmet medical need and worthy of accelerated approval. Finally, let's turn to our progress with Hope Therapeutics. In the six months since Hope was founded, we've considered nearly 100 potential flagship acquisitions. However, they're known to come and go, and too many of them administer ketamine one day, vitamin drips another day, and a variety of services that are colloquially known as medspa services throughout the week. Our objective is to build a national umbrella of precision psychiatry clinics that can safely treat the 3.8 million Americans who make a plan to kill themselves each year, prevent another death every 11 minutes, and take the stigma out of suicidal depression. We've shared with investors that we aim to assemble an organization generating $25 million in revenue by the end of this year and an organization generating more than $100 million in revenue by the end of next year. Those who wish to gain insight into the market value of such an achievement might wish to look at the early development of similar entities such as DaVita for treating kidney failure. Although we and others have used the colloquial term ketamine clinic in association with Hope Therapeutics, you'll hear us increasingly use the term precision psychiatry. The data from the field demonstrate that ketamine alone is not sufficient to maintain remission from suicidality in many patients with depression and PTSD. There seems to be little question that ketamine has achieved a 50% reduction in suicidal ideation in numerous trials and real-world settings. The magnitude and rapidity of effect is a dramatic change from the prior 50 years of experience with SSRI and other serotonin-targeted antidepressants. However, maintaining that ketamine effect and enhancing it will, in our view, require additional therapies such as transcranial magnetic stimulation, an FDA-approved therapy, newly developed digital therapeutics, and oral medicines such as NRX-101. Our focus is on building a comprehensive site of care that can achieve remission in 80% to 90% of patients, not just 50%. Over the past two quarters, we have obtained preliminary funding commitments from financial institutions and have identified several leading precision psychiatry organizations and signed nonbinding letters of intent to acquire key clinics on both the East and West Coast of our country. We've initially targeted these clinics because they'll serve as foundational elements of our network. From our perspective, they epitomize the compassionate, comprehensive, and efficient operational structure that will serve as a model for additional facilities as we bring them into the Hope network. These are critical steps in our quest to make a range of life-saving treatments available to patients across the country. As of last week, our accounting teams have finished confirming the financial statements of these flagship acquisitions, and we've moved into the financial underwriting phase. Hope Therapeutics will offer a comprehensive menu of state-of-the-art precision psychiatry treatments, including IV ketamine, SPRAVATO, transcranial magnetic stimulation or TMS, and medication management, together with planned digital therapeutics designed to augment and preserve the clinical benefit of NMDA-targeted drug therapy. On the financial front, the best-of-class clinics we target are already generating profit margins of around 30%, with significant opportunities for growth. We expect funding for Hope to be independent and thus nondilutive to NRx and to its shareholders. However, we expect that a portion of the earnings generated through Hope will support NRx' path to profitability. Now that the litigation is settled, we continue to work toward a distribution of shares of Hope Therapeutics to existing shareholders, and we plan to seek a public listing for Hope on a national exchange. Our auditors have finalized the initial audit for Hope Therapeutics, and we're now able to draft and file the SEC forms to register the stock. I want to once again thank Rich Narido for his exceptional service as our interim CFO over the past year as we financially reengineered our company and work to build what we hope will be a bright future. Rich will now review our third quarter financials.

Thank you, Jonathan. For the three months ended September 30, 2024, NRx Pharmaceuticals reduced its operating net loss by nearly 75% year-over-year from $6.1 million in the third quarter to $1.6 million in 2024. For that same period, research and development expenses decreased from $3.3 million in 2023 to $0.6 million in 2024. The $2.7 million decrease is related primarily to the decrease of $2.1 million in clinical trial and development expenses due to the conclusion of the Phase IIb/III study relating to NRX-101 and the company's cash conservation efforts. Also in that three month period, NRx achieved a slight decrease in general and administrative expenses from $2.5 million in 2023 to $2.4 million in 2024. For the nine months ended September 30, 2024, NRx Pharmaceuticals reduced its net loss to $16.1 million compared to $25.8 million in the prior year. These efficiencies represent an improvement in net loss of $9.7 million year-over-year and a $1.89 or 54% improvement in net loss per share year-over-year. Over that nine-month period, we recorded $5.2 million of research and development expenses compared to $10.8 million for the same period in 2023, representing a 52% decrease year-over-year. The decrease of $5.6 million is related primarily to the decrease of $6.1 million in clinical trial and development expenses due to the conclusion of the Phase IIb/III study relating to NRX-101, and offset by $1.3 million related to warrants and $0.2 million related to fees paid to regulatory and development consultants. Also in that nine month period, we decreased G&A by $1.4 million, from $12.3 million in 2023 to $10.9 million in 2024, representing an 11% decrease year-over-year. As of September 30, 2024, we had $1.6 million in cash and cash equivalents. Subsequent to September 30, 2024, we added cash by closing tranche two of the secured debt financing in the amount of $5.4 million. This financing is expected to support the filing of new drug applications for NRX-100 and NRX-101, general corporate purposes, as well as to retire historical debt on more favorable terms and lower interest rates. NRx continues to implement operational efficiencies, to extend cash runway and maintain focus on our path to generating revenue and value for our shareholders. With that, I will turn it back to Jonathan.

Thank you, Rich. We look forward to your ongoing support as Hope takes shape and we're able to bring life-saving therapies to patients across the world. Today, we announced that NRx has appointed Michael Abrams as our permanent CFO. Mike brings a wealth of experience both as a public company CFO and in the capital markets, a background well-suited to our long-term goals. Welcome, Mike. Please introduce yourself to our shareholders.

Thank you, Jonathan. I'm excited to join the NRx team at such an important time for the company. In prior engagements, I've joined companies just as they were poised to transition to revenue generation, and I look forward to shepherding NRx through that exciting phase. With major milestones expected in the near term, I see NRx as a unique opportunity and look forward to great things for the company and our shareholders. Jonathan?

Thank you, Mike. We're looking forward to working with you. NRx is dedicated to preventing and treating suicidality in patients with depression and PTSD. Filing our two NDAs in the near term and continuing the development of Hope Therapeutics national network for care delivery are transformative steps for the company and for the treatment of patients. I'd like to thank our team, our investors, and most importantly, the patients who participated in our clinical trials, for their steadfast support in pursuit of this vision. Operator, we're ready to take questions from the audience.

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Your first question comes from the line of Jason Kolbert from D. Boral Capital. Please go ahead.

Good afternoon. Thanks for the update. Jonathan, I'd like to zoom in a little bit on the accelerated approval, what you think is involved in that process? And if you get it, what does that mean in terms of a PDUFA date and the timeline for both? And I know you're really talking about NRX-101, but kind of what is the PDUFA date, do you think, and the timeline likely for NRX-100 as well? Thanks.

So in order to sort of unpack those questions, accelerated approval is a process, and people can look this up on the FDA website, where a sponsor has identified an important intermediate endpoint for a drug, but has not necessarily identified sufficient efficacy data for permanent approval of that drug. So in the case of NRX-101, what we've not yet done is a 300- to 500-person clinical trial of NRX-101 against placebo to prove that it's better than placebo, although we know that its components have beaten placebo in multiple trials, especially lurasidone. On the other hand, we now have two clinical trials where NRX-101 has demonstrated reduction in suicidality and akathisia compared to lurasidone. And we believe that akathisia and suicidality are critical intermediate endpoints. We don't have proof that they're associated with long-term survival, but we certainly know that suicidality can be associated with short-term demise. Therefore, we intend to seek accelerated approval, which is a process by which the FDA grants five years of marketing rights to a drug, during which time, permanent data, permanent approval can be obtained. Now you may say, how are we ever going to get that long-term data? Well, there's a national study spinning up where patients are being randomized to different currently marketed drugs for treating bipolar depression. Within that study, there is not yet any arm for drug therapy of patients who have suicidality and akathisia. The only treatment that's approved for suicidality today is electric convulsive therapy. We've been in touch with the investigators of that study, and we think it's not unlikely that, that may be the place where patients in large numbers are randomized to NRX-101 over the next five years in a manner that gains permanent approval. We're not ruling out the possibility that a pharmaceutical company might step in and want to finance that definitive study as a traditional industry-sponsored study, but we believe that there's another path, one that's far less dilutive to our shareholders as well. Now you asked about NRX-100, and that's a situation where we now have randomized control data demonstrating that NRX-100, that is IV ketamine, reduces suicidality and depression compared not only to placebo but to active comparator. Moreover, as people know from our slide deck, recent data show that ketamine is at least as good as electroshock therapy in treating depression. In terms of PDUFA dates, we expect to have PDUFA dates both on NRX-101 and NRX-100 during 2025. Does that answer the question, Jason?

It does. That's a great answer. Thank you. Can I ask you to talk a little bit about Hope? You mentioned the difference between ketamine clinics that focus on various infusions for people and a real psychiatric center. My question is, are you finding motivated individuals who truly want to build a comprehensive psychiatric center? Do you think you will be able to acquire them in a way that allows you to develop a national presence?

Well, I think it's fair to say that after a thorough search, we have identified several clinics that are effectively integrating ketamine, TMS, solid psychiatric medical management, and traditional therapy in a model that best serves patients. We have confirmed that these clinics can operate with a healthy margin, around 30%, and since some of these organizations have signed letters of intent to be acquired by us, we believe our business model is viable. Are these clinics a minority of what exists today? Absolutely. We've observed various private equity acquisition models for clinics that have had mixed results. However, we believe that an integrated precision psychiatry model is essential for maintaining a strong presence in the market while maximizing patient benefits.

Perfect. I want to ask Mike a question today. Mike, it's great to hear from you again. We've known each other for a while, and you should be excited to be at this company, as I'm sure you are. In the third quarter press release, there was a mention of revenues this year and profitability next year. Can you discuss how you assessed the revenue growth when you joined the firm and your perspective on what that looks like over the next year?

So thank you, Jason. Just to be clear, those numbers are not my build, but I did...

I know it's not a fair question, but I know you did due diligence.

Yes, I conducted thorough research on it. Essentially, it's a numbers game. There are specific clinics that align with the model developed by Jonathan and his team, and we can anticipate certain profitability levels from those. When we analyze the clinics they have already engaged with regarding letters of intent and consider the potential additional ones, it becomes clear, especially since they have already performed a significant number of audits on these possible acquisitions. It's a matter of constructing a model based on various factors, and the results emerge from that. While there's still considerable work ahead, my initial findings indicated that the numbers are promising and can be built upon. Therefore, I am quite confident, although implementing these plans is crucial. Moreover, as we analyze the larger picture, we begin to incorporate both NRX-100 and NRX-101, allowing us to develop the model from multiple perspectives. At that point, I focused on the overall market potential. According to CDC statistics, someone dies by suicide every 11 minutes in the U.S. and every minute worldwide, which clearly indicates the demand. If our company can convincingly demonstrate that it offers a solution leading to better patient outcomes, the market is there, and we just need to execute effectively. These aspects of my investigation excited me and inspired my eagerness to join the company. Does that address your question?

Yes, it does. And it sounds like you share Jonathan's vision and what I see in the company, which is it's a fractured system with many different therapies, and nobody seems to be pulling it all together in one central place for patients, which is what has to be done to save lives. So I mean it's a noble cause. Thanks so much. Appreciate the update.

Thank you. And your next question comes from the line of Ed Woo from Ascendiant Capital. Please go ahead.

Yes. Congratulations on all the progress. In terms of the valuations for these precision psychiatry clinics, are there any issues in terms of finding enough of these clinics at reasonable valuations? Or do the valuations really fluctuate wildly? And have you thought about possibly building as opposed to buying? Thank you.

Thank you. It's really a great question. And I think we're going into this knowing that there aren't nearly enough clinics that meet our model, the model that we've laid out in this call, to build a national network. So then our choices will be acquiring clinics that meet some piece of the model and enhancing their offering to where they're able to meet the whole model versus literally going and building out space and hiring caregivers and building a clinic from the ground up. We know that capital is available for both of those, and we'll be opportunistic in terms of what we do. What you probably won't see us do is take over a medspa that's doing ketamine on Monday and vitamin drips on Tuesday and put our name on it.

Great. Well, thanks for answering my questions. And I wish you guys good luck. Thank you.

Thank you. And your next question comes from the line of Vernon Bernardino from H.C. Wainwright. Please go ahead.

Hi, good afternoon, everyone. Congrats on the progress and the exciting changes and structure of the company to come. Just had a question as far as revenue recognition, perhaps. You're pretty confident, Jonathan, about recognizing some form of revenue this quarter. Just wondering, that's contingent on all the things that are pointing to signing on the dotted line, right? And in that recognition and signing, is that something where the revenue generated from that day plus one is the revenue you'll be recognizing? Or will you also, as part of the acquisition, be recognizing the historical for the beginning of this quarter when you have the structure in place?

Yes. That's really a Mike Abrams question, and it may even be one where he needs to come back to you in a note that we'll share with both you and the public. But what I said is that by the end of the year, we expect to have aggregated organizations that are generating revenue. I'm not an accountant, and I certainly am not an expert on U.S. GAAP as it relates to recognition of revenue for medical services, so if Mike's comfortable talking about our general approach to recognizing revenue, he's welcome to. But at the same time, he's now about to go into a series of conversations with our public auditors where we set some ground rules for how and when we're going to recognize revenue. So Mike, let me turn it over to you.

Thank you, Jonathan. I don't have much to add to that. I think you addressed it very well. Revenue recognition is a complex topic that has seen significant changes over the past few years. To respond responsibly, I would have preferred to engage in detailed discussions with our auditors. I can assure you that our company, in line with GAAP and in collaboration with our auditors, will ensure that our revenue recognition policies are defensible and compliant. However, I don't think it's appropriate to delve into more details or specifics regarding revenue recognition at this time.

Okay. As a follow-up to that, though, when you do perhaps give some kind of insight or maybe even some guidance, will you be providing some level of detail as far as how well are the level of business these entities actually realize?

Yes. When we discuss it publicly, the description and disclosure will be thorough and include all known facts at that time. However, we are not quite there yet.

Okay. Thanks for taking my questions. Congrats. Welcome aboard, Michael. Looking forward to working with you. Thanks, Jonathan.

Thank you.

Thank you. There are no further questions at this time. I will now hand the call back to Mr. Matthew Duffy for any closing remarks.

Thank you, everyone, for joining us this evening. We're extremely excited about the coming months and quarters, the two potential drug approvals, and our subsidiary targeting multiple profitable precision psychiatry clinics. This concludes the NRx Pharmaceuticals Third Quarter 2024 Results Conference call. Thank you for participating, and you may disconnect.