Good afternoon, everyone, and welcome to the Relmada Therapeutics, Inc. First Quarter 2024 Financial Results Conference Call. This call is being recorded on Wednesday, May 8, 2024. I would now like to turn the conference over to Tim McCarthy, LifeSci Advisors. Please proceed.

Thank you, Colin, and thank you all for joining us this afternoon. With me on today's call are our Chief Executive Officer, Sergio Traversa, and Chief Financial Officer, Maged Shenouda. This afternoon, Relmada issued a press release providing a business update announcing financial results for the 3 months ended March 31, 2024. Please note that certain information discussed on the call today is covered under the safe harbor provision of the Private Securities Litigation Reform Act. We caution listeners that during this call, Relmada's management team will be making forward-looking statements. Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. These forward-looking statements are qualified by the cautionary statements contained in Relmada's press release issued today and the company's SEC filings, including in the annual report on Form 10-K for the year ended December 31, 2023, and subsequent filings. This conference call also contains time-sensitive information that is accurate only as of the date of this live broadcast, May 8, 2024. Relmada undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call. Now I would like to turn the call over to Sergio. Sergio?

Thank you, Tim, as always, and good afternoon to everyone, and welcome to the Relmada First Quarter 2024 Conference Call. We continue to achieve meaningful progress in the advancement of our ongoing Phase III program for REL-1017 in major depressive disorder (MDD), as well as in the promising preclinical novel psilocybin program, all of which I will briefly cover today. Following this, Maged will review our first quarter 2024 financial results, and then we will take your questions. Let's begin with an update on the late-stage Phase III program for REL-1017. As a reminder, Relmada is focused on developing REL-1017 as an adjunctive treatment for MDD. We previously executed important revisions to Reliance II, the ongoing Study 302, which is a Phase III, 2-arm placebo-controlled pivotal study evaluating REL-1017 25 milligrams for adjunctive MDD. These modifications were aimed at controlling the placebo response and improving the profile of patients enrolled. The amended Study 302 protocol has been implemented across all of our clinical sites. Enrollment continues to advance, and our ability to leverage our close relationship with the study sites continues to play a critical role. Moreover, the ongoing initiatives we have put in place to drive trial awareness with prospective patients are generating positive results. As we said on our last call, we are evaluating the quality and productivity of sites on a real-time basis and making adjustments as appropriate. As a reminder, we plan to enroll approximately 300 patients into Reliance II. Based on our current projections, we continue to expect Reliance II to be completed with top-line data anticipated in the second half of this year. We are also continuing to enroll patients in our second Phase III trial for REL-1017, Relight or Study 304. It also has a planned enrollment of approximately 300 patients. Like Reliance II, Relight is a randomized, double-blind, placebo-controlled 4-week trial, evaluating the efficacy and safety of REL-1017 as an adjunctive treatment of MDD in patients experiencing inadequate response to ongoing background antidepressant treatment. The primary endpoint of both studies is the same: the change in the MADRS total score from baseline to day 28 for REL-1017 as compared to placebo. I would like to emphasize again that we have made meaningful revisions to our screening and enrollment processes to ensure that we have patients that meet all of the qualifying criteria within our desired patient profile. To this end, we are now executing on a comprehensive adjudication process through which we acquire medical and pharmacy records for all patients enrolled in Reliance II and Relight. Given this, the screen failure rate in this study has increased to approximately 80% versus approximately 50% in Reliance I and Reliance III, our previously completed Phase III trial REL-1017. However, we are highly confident that these changes will substantially enhance the probability of success of the current studies. I would also like to highlight that we have completed all of the necessary preclinical manufacturing and Phase I study required for a potential REL-1017 NDA filing, and our current focus is on executing the remaining two Phase III studies, 302 and 304. Moving on now to the promising novel modified-release psilocybin program. We continue to anticipate the initiation of a single-ascending dose Phase I trial in obese patients in the first half of this year to define the pharmacokinetic safety and tolerability profile of our modified-release psilocybin formulation in this population, followed by the Phase IIa trial to establish clinical proof-of-concept. Data from the planned IIa study is anticipated in the first half of 2025. These planned studies will build on the compelling preclinical data that were presented in a poster presentation at last November's AASLD meeting, the liver conference. These results showed the beneficial effect of low, chronic dose psilocybin on multiple metabolic parameters in a rodent model of metabolic dysfunction associated with steatotic liver disease (MASLD). Based on this data, low-dose psilocybin could improve lipids and glucose with potential for fewer side effects over other investigative treatment approaches such as GLP-1, glucagon, and GIP. To summarize, our multiple upcoming key milestones over the next 12-18 months include the ongoing Reliance II study to be completed with top-line data in the second half of this year. In addition, we anticipate initiating a Phase I clinical trial for our modified-release formulation of psilocybin before the end of the current quarter. Lastly, while Maged will provide a detailed review of our financials, I would like to highlight that we continue to advance our pipeline from a position of significant financial strength, with cash on hand to take us comfortably into 2025. I will now turn the call over to Maged to review our first-quarter financial results. Maged?

Thank you, Sergio. Today, we issued a press release announcing our business and financial results for the 3 months ended March 31, 2024, which I will now review. For the first quarter ended March 31, 2024, total research and development expense was approximately $13.3 million as compared to $15.9 million for the comparable period of 2023, a decrease of approximately $2.6 million. The decrease was primarily associated with the completion of the long-term open-label study, Study 310 in the third quarter of 2023 as well as Reliance I and III. The noncash charge related to stock-based compensation for R&D totaled $1.7 million in the most recently completed first quarter. Total general and administrative expense for the first quarter ended March 31, 2024, was approximately $9.7 million as compared to $12.3 million for the comparable period of 2022, a decrease of approximately $2.6 million. The decrease was primarily driven by a decrease in stock-based compensation expense, a noncash charge related to stock-based compensation for G&A totaled $6.6 million in the most recently completed first quarter. For the first quarter ended March 31, 2024, the net loss was $21.8 million or $0.72 per basic and diluted share compared with a net loss of $26.3 million or $0.87 per basic and diluted share in the comparable period of 2023. As of March 31, 2024, we had cash, cash equivalents, and short-term investments of approximately $83.6 million compared to $96.3 million as of December 31, 2023. Cash used in operations in the first quarter of 2023 was $13 million. Based on our clinical development plan, our current cash position provides us with a comfortable runway into 2025. I will now ask the operator to please open up the call for questions. Operator?

Thank you. Ladies and gentlemen, we will now start the question-and-answer session. Your first question comes from Basma Radwan Ibrahim from Leerink Partners.

This is Basma on for Marc. I have a question about the ongoing Reliance and Relight trials. In the previous earnings call, you mentioned that you were monitoring the trial and looking at the blinded data. Can you provide some insights regarding the blinded data from Reliance and Relight compared to the prior trial that had a larger placebo response? Are there any similarities or differences that you can share to explain the strategy you implemented to reduce the placebo response?

Yes, sure. And thanks for the question. I'll give you a top-down answer first, and then we have Dr. Andrew Cutler, our Clinical Advisor, on the call, who'll provide a little bit more details about this aspect. First, let me say something about the blinded data: there is absolutely no way to guess from the blinded data the outcome of a clinical trial. We have seen that in the last two trials that we had. The help that we can get or that everyone can get from monitoring the blinded data is only and exclusively to see if there is something that is not consistent. I'll give an example: If there are individual patients with the MADRS scores week-over-week that go up and down, or we call it zigzag, then you know that there is something that is not right. It can be the patient or it can be the site. But usually, a patient that responds is consistent over 4 weeks, and if they don't respond, they are still consistent over the 4 weeks. So if you see a zigzag, that's a signal that something is not right, and we take a look at that in patients, and mostly at the site. That is the only help that you can get from the blinded data, but it is important, right, to continue to monitor to see that not many of these patients with this zigzag pattern get into the trial. When it's in there, there is nothing we can do, but we can at least advise the site that something is a kind of like a red flag. Andy, you're on the call—would you mind providing some more details about it?

Yes. I absolutely agree with what Sergio said. What you look for is consistency and quality indicators. In addition to what he said about the primary, the MADRS zigzag, you also look for consistency across different scales. The primary key secondary outcome, of course, being a CGI, usually that moves in the same direction as the MADRS, which measures depressive symptoms. I would say that in the previous trial, sites were allowed to enroll rather quickly without watching the quality as closely as we're doing now, and that can certainly be a problem. So we're now being much more careful with the enrollment, not allowing a site to over-enroll patients until we've looked at the quality, monitoring the quality of each site and the trial overall. I would say things are looking fine from that point of view at this moment.

Thank you, Andy, and I hope that answered your question.

Your next question comes from Andrea Tan from Goldman Sachs.

Maybe one follow-up to your remarks right there. As you are monitoring the sites, if you see the inconsistencies that you've just spoken about, maybe walk us through what steps you would take to remediate those issues. And then I have one follow-up question.

Yes, good afternoon, Andrea, thanks for the question. As before, I will give you a short answer, and then Andy, if you would like to provide a little more detail. But in general, first, you contact the site and discuss the details regarding any patients that have some inconsistencies. Then, you go through the whole process. Ultimately, if that becomes a pattern, you don't want to have a site that shows inconsistency in enrolling 10 or 20 patients because that would affect the overall trial. So the ultimate measure is to close the site. But Andy, I'm sure can give you a little more color on this.

Yes, that is well said. The most important thing is to not allow a site to continue to enroll patients and have problems like that. If one or two sites have too many patients, that can kill a trial. But also, if you do see this—first of all, the site knows, having run sites, if you’re looking over my shoulder, you're going to call me. It really does make them be on their best behavior and not cut corners. So, ultimately we have closed down some sites that have quality issues. So ultimately what you do is to stop them from enrolling so that they don't have a chance to interrupt the study.

Can you just remind us quickly if you are planning on having an interim analysis? Or is there going to be any type of mechanism in place for the DSMB to recommend stopping the study early as they have in your prior trial?

We will have—not we, but the data monitoring committee will look at the data at some point very close to the end. But this is not an interim analysis because there is no statistical penalty. It's a simple reestimation. They will let us know if the sample that we have in the trial is enough to reach statistically significant results or if we need to expand the trial. So there is no early stop planned.

The other major function of the DSMB, of course, is to monitor safety. The good news is the safety and tolerability have looked very good.

Your next question comes from Andrew Tsai from Jefferies.

Congrats on the progress. This is Matt calling in for Andrew. And I guess continuing with the same theme. Do you have any specifics on the numbers of sites that you had to pause, close, or have been able to even reopen using your monitoring real-time analysis? And also we've seen quite a few companies that have announced delays, for instance, in the schizophrenia and epilepsy spaces. Are you seeing any increased level of competition in terms of funding the right MDD depression patients?

Sorry, I can barely hear you.

Okay. Can you hear me better now?

Much better, yes. Thank you. Sorry for that.

So yes, I was just asking, continuing with the real-time analysis, if you had any specifics on the number of sites that you had to pause, close or maybe even reopen? And then also over the past year, we had—again, we've seen quite a few companies that have announced delays—for instance, in the schizophrenia and epilepsy spaces. Are you seeing any increased level of competition in terms of funding the right MDD depression patients?

Thanks for the question.

Yes, thank you very much for the question. In terms of site selection, it's not fixed—you decide 50, 60 sites at the beginning and finish with the same number. It is an ongoing process. So constantly, there is a revision of sites and some sites are closed, not only for quality issues but also for competing studies or because they have exhausted the patient population they can enroll. It is ongoing. I don't have the exact number on the top of my mind, but it's not that at some point you do a review. It's an ongoing process. Maybe Andy can give you a little bit more detail since he runs clinical sites. There is clearly some competition out there. Usually, a site does not take on three or four studies that enroll the same kind of patients. In our case, it's a little particular because we are doing—these studies are for adjunctive treatment of depression. Therefore, the competition is much less because there are not many other programs, especially in Phase III that enroll patients as adjunctive. We believe there was one other company that finished one sizable study a few weeks ago, but the majority of the sites that were outside the U.S., so there was relative competition, but it was not an antidepressant anyway. We keep on hearing that there are a lot of trials ongoing with psilocybin in depression that are not really direct competitors, but still, it keeps the site busy. So to summarize, yes, there is competition, but we are in a specific indication where the competition is much lower. Andy, would you mind providing a little bit more color?

The second—I'll answer the second one first: Sergio is exactly right. At the site level, you don't want to take too many competing studies. Usually, the study criteria are different enough that you can run two or three depression studies without significantly impairing enrollment, as a patient will more clearly fit into one protocol than another. As for the first question, I don't have the exact number of sites that we've closed down offhand, but sites do close for various reasons. That's certainly true. But we have stopped enrollment at a couple of sites, I can say that, but it's not a lot, fortunately. I think some of it is simply the process of overseeing the sites; they know that they're being watched. The monitoring quality often changes the behavior enough so that significant corrective action isn't necessary.

Got it. Yes. That makes sense. And then, I guess, regarding the Phase I psilocybin program that you're going to be kicking off soon. Can you describe the study design and what positive data would entail?

Yes, it's very simple. We'll start with a Phase I single-dose, ascending dose of psilocybin modified release. The interesting part is the patient population; technically, Phase I is generally done in healthy volunteers. However, it's well known that psilocybin is a relatively safe product at high doses, and we are using a dose that is much lower, around 120 or 130 micrograms compared to the doses used for the treatment of psychotic diseases. So on the safety side, we feel extremely comfortable. The indication we pursue for psilocybin is in the metabolic space—obesity, glucose, and fatty liver. The data we are looking for is primarily pharmacokinetic data in obese patients. The particular patient population will consist of obese healthy volunteers, and we should start over the next month or two, as we mentioned, within the first half. It’s a short study lasting about 3-4 months at maximum.

Your next question comes from Uy Ear from Mizuho.

This is Charles on for Uy. I had a question about the screening failure rate and if you think that's going to stay at around 80% throughout the study enrollment. And also, if you could clarify if Reliance II's screening failure rate was also 50% before the new protocol?

Charlie, thanks for the question. Yes, the screening failure is high, but we look at the reasons for the screening failures, and there are legitimate ones, right? It usually is drug-drug interaction or mostly concomitant medication. So yes, these are legitimate reasons not to enroll in the study. Most of the screening failures come from the site. With that said, we are in constant review and we listen very carefully to the feedback from the sites. If there is anything we can do to increase the enrollment rate or decrease the screening failure without decreasing quality and increasing the risk of the trial, we have been doing that. There are certain things, especially on the drug-drug interactions or concomitant medications, that have been changing over time. So that should facilitate this process, and this is a feedback loop from the company and the site. They provide us feedback, and we see patients with characteristics that could fit into the trial, but we cannot enroll them because of the inclusion-exclusion criteria. So we revised and, in dialogue with the FDA, we have made detailed revisions of the protocol over time. We don't know what will happen with screening failure, but there is definitely a chance that we could improve it. The second question was about screening failure rates in the past; that's a great question, but I don’t have the exact answer on the top of my head. I probably wouldn't put too much weight on that number; there weren't many patients enrolled to begin with.

I don't believe it was quite as high...

Yes, go ahead, Maged, sorry.

Go ahead, Andy.

Exactly. But I would not be put off by the screening failure; we're trying to find the right patients, and that's critically important. Patient selection is absolutely a source of failure in studies.

Okay. As we mentioned in some of our calls, one of the biggest changes we made to the protocol is now a requirement for medical and pharmacy records, which increased the screening failure rates. However, we are also relatively comfortable knowing the patients are coming from doctors that have diagnosed and prescribed medication and that the patient has actually purchased the medication from the pharmacy. So the two factors lead to a higher screening failure rate but an improvement in the risk profile of the patients enrolled. I hope that answers your question.

There are no further questions at this time. I'll turn it back to Sergio for closing remarks.

Thank you. In summary, we continue to firmly believe that we have an approvable drug in REL-1017, and we are excited about the potential of our novel psilocybin derivative program. We look forward to reporting further progress with our pipeline throughout the remainder of 2024. I remain grateful to the Relmada team for their continued hard work and dedication to executing our mission. Also, as always, I would like to extend my sincere thanks to the patients and clinical partners involved in the REL-1017 trials for their participation in the advancement of this promising investigational medicine through development. Thank you all for your attention and interest, and I look forward to the next conference call.

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.