Earnings Call Transcript - RLMD Q1 2025

Operator, Operator

Good afternoon. Welcome to the Relmada Therapeutics First Quarter 2025 Earnings Call. As a reminder, this conference is being recorded and will be available for replay on the location website. I would like to turn the call over to Brian Ritchie from LifeSci Advisors. Please go ahead, Mr. Ritchie.

Brian Ritchie, LifeSci Advisors

Good day and thank you everyone for joining us today. This afternoon, Relmada issued a press release providing a business update and outlining its financial results for the 3 months ended March 31, 2025. 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, and today’s form 10-Q for the quarter ended March 31, 2025, filed after the close today. This conference call also contains time-sensitive information that is accurate only as of the date of this live broadcast, May 12, 2025. Relmada undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call. With me on today’s call are Relmada’s CEO, Dr. Sergio Traversa, who will briefly provide a summary of recent business highlights; and Relmada’s CFO, Maged Shenouda, who will provide a review of the company’s Q1 financial results. After that, we will open the line for a brief Q&A session. Now, I will hand the call over to Sergio Traversa. Sergio?

Sergio Traversa, CEO

Thank you, Brian, as always, and good afternoon and welcome everyone to the Relmada First Quarter 2025 Conference Call. 2025 is off to a good start for Relmada. We added two unique product candidates with very encouraging Phase 2 data and large addressable markets to our portfolio, NDV-01 for bladder cancer and sepranolone for Prader-Willi syndrome, Tourette syndrome, and potentially other CNS indications. Reported initial proof-of-concept Phase 2 data for our lead product candidate, NDV-01 at the American Urology Association, and we made progress towards our objective of bringing each program to patients as soon as possible with preparation underway to begin the next set of studies for NDV-01 and sepranolone. With two innovative product candidates that have shown promising proof-of-concept data, a $27 million cash balance, a clean balance sheet, and a disciplined approach to development plan, we are in a good position to advance our pipeline to important clinical milestones. During today’s call, I will provide a snapshot of our two programs, including a review of the initial Phase 2 data for NDV-01 at the AUA meeting 2 weeks ago. After that, Maged will review our financial results. I will make a few closing remarks, and then we will take your questions. We also invited Dr. Yair Lotan, Chief of Urology and Oncology at the University of Texas Southwestern Medical Center in Dallas, who can answer your clinical questions regarding NDV-01. We are encouraged by the potential of the diversified pipeline that we are building at Relmada. Starting with NDV-01, we believe the program is an excellent fit with our strategic plan and has the potential to meaningfully improve the care of patients with bladder cancer. Our decision to in-license NDV-01 was based on strong science, strong field data, and the anticipation of positive Phase 2 data at the upcoming American Urology Association Meeting, or AUA 2025. I’m pleased to report that positive top-line proof-of-concept data presented at AUA 2025 supported our initial enthusiasm for NDV-01’s potential to be the class-leading bladder-sparing chemotherapy for non-muscle invasive bladder cancer. During today’s call, I will touch on the market opportunity, the mechanism of action, the data, and the next steps. Starting with the market, sources indicated that there are about 75,000 new cases of bladder cancer diagnosed each year in the U.S. About half or 50% of those cases have high-grade disease that has a high risk of recurrence. That is a very high recurrence rate for the 600,000 people approximately in the U.S. living with bladder cancer. Moving to the mechanism of action, NDV-01 is a novel sustained-release intravesical formulation of two chemotherapy agents, gemcitabine and docetaxel, or GEM/DOCE. NDV-01 forms a spherical soft matrix within the bladder that sequesters GEM/DOCE and releases these two agents as the matrix gradually dissolves. The formulation was specifically designed to maximize local GEM/DOCE concentration and also provide prolonged exposure while minimizing systemic toxicity. Published clinical studies have shown that gemcitabine and docetaxel achieve a response rate and recurrence-free survival that are comparable to or better than the historical standard of care, Bacillus Calmette-Guerin, or BCG. However, the administration of conventional chemotherapy is cumbersome. The two chemotherapy agents require special handling and preparation in a controlled hospital pharmacy setting. In addition, the two chemotherapies are administered sequentially over 3 to 5 hours with limited tumor exposure time. In contrast, NDV-01's sustained-release formulation is intended to be dosed in office as a ready-to-use therapy that is administered in less than 10 minutes without the need for anesthesia or new or dedicated equipment. What is really exciting about NDV-01 data is the data presented at the AUA 2025 two weeks ago. The presentation was based on data from an ongoing single-arm, single-center ex-U.S. Phase 2 study evaluating NDV-01 in patients with high-grade NMIBC. Twenty-six patients have been enrolled as of the last data cutoff. The AUA presentation was based on the results for the first 20 patients. The group included 2 patients with carcinoma in situ, CIS, and 18 patients with papillary disease, Ta, and T1. Of the papillary disease patients, 8 were BCG naive and 12 were BCG unresponsive. The efficacy data were presented based on 3- and 6-month assessments. In addition, the highest response rate at any time point was also reported. Based on the 3-month assessment, dosing of NDV-01 resulted in an overall response rate of 85%, or 17 out of 20 patients, and high-grade recurrence-free survival in patients with papillary disease of 83%, or 15 out of 18 patients. A complete response in carcinoma in situ patients, recognizing that the number is small, was 100%, or 2 out of 2 patients. For data reported at any time point, the overall response rate was 90%, or 18 out of 20 patients. High-Grade Recurrence-Free Survival in papillary disease was 89%, or 16 out of 18 patients. Complete response in carcinoma in situ patients remains 100%, or 2 out of 2 patients. Importantly, 7 patients were evaluable at 6 months. One hundred percent of these patients achieved disease-free status. This group includes 1 patient with CIS and 6 patients with papillary disease characterized as Ta or T1. One of these patients was retreated at 3 months and responded to the second treatment. From a safety perspective, NDV-01 was well tolerated with no treatment-related adverse events greater than Grade 1. We were very pleased with the reception of the data received at AUA. We believe that the results suggest that NDV-01 has the potential to significantly improve the care of patients with NMIBC. NDV-01 is currently continuing the Phase 2 single-arm study to assess safety and efficacy in patients with high-grade non-muscle invasive bladder cancer. Our goal is to bring NDV-01 to patients as soon as possible. Looking ahead to the second half of 2025, our effort will focus on securing a U.S. IND clearance. Turning briefly to sepranolone, in February, we acquired the right to sepranolone from Asarina Pharma. Our decision was based on sepranolone’s broad safety database and promising Phase 2 results in Tourette syndrome. I would like to touch on four topics for sepranolone: the market opportunity, the mechanism of action, the data, and the next steps. Starting with the market, we believe sepranolone is well-suited to treat disorders marked by compulsive behavior and excessive activity of the GABA neurotransmitter pathway, including Prader-Willi syndrome and Tourette syndrome. This neurobehavioral disorder can manifest through repetitive behavior and positivity and represents sizable underserved markets. Prader-Willi syndrome is our first candidate indication for sepranolone. Prader-Willi is a complex genetic disorder, often defined by persistent anger and hyperphagia. Current treatment is focused on improving obsessive-compulsive behavior and other medical complications. Prader-Willi is estimated to affect approximately 350,000 people worldwide, including approximately 20,000 people in the U.S. Turning to the mechanism of action, sepranolone is a first-in-class endogenous neurosteroid. It’s a member of a new subgroup of neurosteroid called GAMSAs or GABAA modulating steroid antagonists. GAMSAs selectively act on GABAA to alleviate the repetitive symptoms of compulsive disorder. We were attracted to sepranolone because of its unique mechanism of action and promising proof-of-concept data. The Phase 2 results from the originator Asarina showed that sepranolone demonstrated a competitive peak reduction of 28% with a p-value of 0.051 in its primary clinical endpoint as measured by the YGTSS, a standardized Tourette scale. The data also showed that sepranolone treatment produced an improved quality of life without any off-target CNS effects. These data provide a strong foundation to study sepranolone in compulsion-related disorders such as Prader-Willi syndrome. Our effort to progress sepranolone is expected to include planned FDA interaction and further development of product supply, with plans to advance into clinical development in early 2026.

Maged Shenouda, CFO

Thanks, Sergio. With two innovative product candidates that have shown promising proof-of-concept data, a $27.1 million cash balance, a clean balance sheet, and a disciplined development plan, we are in a good position to advance our pipeline to important clinical milestones. Turning to our financial results, as noted by Brian, this afternoon we issued a press release announcing our business and financial results for the first quarter ended March 31, 2025. As of March 31, 2025, Relmada had cash, cash equivalents, and short-term investments of approximately $27.1 million, compared to $44.9 million as of December 31, 2024. Cash used in operations in the first quarter ended March 31, 2025, was $18.1 million, compared to $13 million for the same period in 2024. Our efforts in 2025 are dedicated to advancing NDV-01 and sepranolone through key development milestones. Over the coming months, as we finalize our clinical and regulatory strategy for each program, we expect to have better visibility into our requirements and runway. Moving through our first quarter 2025 financial results, research and development expense for the first quarter of 2025 totaled $12 million, compared to $13.3 million for the first quarter of 2024, a decrease of $1.3 million. The lower spend was primarily driven by lower study costs with the completion of clinical trials for REL-1017 for major depressive disorder, offset by payments for the sepranolone acquisition and the NDV-01 in-licensing. General and administrative expense for the first quarter of 2025 totaled $6.3 million, compared to $9.7 million for the first quarter of 2024, a decrease of approximately $3.4 million. The decrease was primarily driven by a decrease in stock-based compensation expense. The net loss for the first quarter of 2025 was $17.6 million, or $0.58 per basic and diluted share, compared with a net loss of $21.8 million, or $0.72 per basic and diluted share for the first quarter of 2024. Before we open the call for questions, I’ll turn back to Sergio for some closing comments.

Sergio Traversa, CEO

Thank you, Maged. I would like to leave you with these key messages from today’s call before we enter the Q&A section. 2025 is off to a strong start with the addition of two unique product candidates with proof-of-concept Phase 2 data and a large addressable market to our portfolio, NDV-01 for bladder cancer and sepranolone for Prader-Willi syndrome and Tourette syndrome. We reported positive initial proof-of-concept Phase 2 data for our lead product candidate, NDV-01 at AUA, and we made progress toward our objective of bringing each program to patients as soon as possible, with preparation underway to begin the next set of studies for NDV-01 and sepranolone. With two innovative product candidates that have shown promising proof-of-concept data, a $27 million cash balance, a clean balance sheet, and a disciplined approach to the development plan, we are in a good position to advance our pipeline to important clinical milestones. As we prepare to advance our two clinical programs, we want to thank our investors for your support and for taking the time to join today’s call. Operator, I would like now to open the call for questions.

Operator, Operator

Our first question is from Uy Ear with Mizuho Securities. Please proceed.

Uy Ear, Analyst

Hey, guys. Yes, thanks for taking our questions and congrats on the quarter, the recent data. So maybe the first question for us is, you indicate you’ll be approaching the FDA to speak with them in order to move forward. I guess what gives you confidence that the current data from the Phase 2 study would be sufficient for the FDA to agree for NDV-01 to move into registrational studies? And I guess the second question, maybe is you indicate that you are going to scale up supply, could you sort of elaborate on what you mean by that? Are they commercial products? Are they scaling up for clinical study only? Thanks.

Sergio Traversa, CEO

Thank you, Uy for the question. Let me answer the first one, and I believe Dr. Lotan should have joined the call. Anything you would like to add would be very welcome. But what makes us confident that the conversation with the FDA will drive the beginning or the start of registrational product and program? A couple of things: one is the combination of the drug itself, right? Gemcitabine plus docetaxel has been used and has been currently used for some time by many, many urologists everywhere, and everybody is convinced about the efficacy and safety of the local administration of the two drugs. The reason that has not been more widely used is the limitation in practicality. Very few doctor offices can prepare the solution. It has to be prepared by pharmacists authorized and used to handle chemotherapy, most of the cases in clinics. The administration requires a sequential gemcitabine and docetaxel one after the other, and it takes time. You have to keep the doctor office or the clinic occupied for three hours, four hours, five hours, and for the patient, too, because they have to see it in the clinic holding for one hour or two hours for each of the two preparations. Even if a patient affected by bladder cancer is willing to go through a lot to avoid taking their bladder off, it is still a convoluted process. That’s one of the reasons that we feel confident that the combination of chemotherapy is not new. It’s well known, is in use, and is recognized as one of the most effective, if not the most effective pharmacological treatment of bladder cancer. The second point comes from the data and the safety of the formulation; we have not had a single patient interrupt the study for side effects, and all registered side effects are Grade 1. It seems it’s very well tolerated. When you put the two things together with the advantage of administration in the doctor’s office with non-anesthesia and less than 10 minutes with a prefilled syringe that doesn’t need any handling, all the things combined should make the FDA willing to let us go into a larger registration study. Of course, there is always uncertainty until we get the minutes from the FDA, but we believe there is a very good chance they will be okay with that. I don’t know if Dr. Lotan has been able to join the call.

Yair Lotan, Chief of Urology and Oncology

Yes. Good afternoon. Can you hear me okay?

Sergio Traversa, CEO

Yes, absolutely. Very well. Go ahead.

Yair Lotan, Chief of Urology and Oncology

Thank you. I think I can address the issue to some degree. First of all, intravesical chemotherapy has been routinely used for treating both intermediate risk and high-risk bladder cancer for decades. Now, it’s interesting because the therapies that are currently used, mitomycin, gemcitabine, and docetaxel are all being used as off-label use, but they are reimbursed and commonly utilized. The biggest challenge for urologists, though, is that you need a hood to mix these formulations. Unless you have a cancer pharmacy, you can’t give it in your office. Immune therapies like BCG come in a vial and a powder that you can reformulate, but intravesical chemotherapy, you can’t. Medical oncologists who give IV doses of chemotherapy are not typically providing intravesical therapies in their offices. They are not familiar with placing catheters. There is little reimbursement. And so you have a bit of a catch-22. If you are a patient, you can’t really get it in your urologist’s office or at your medical oncologist's office. The formulation of gemcitabine and docetaxel is actually one of the more commonly used drugs in BCG-unresponsive situations, a space with a lot of development between nadofaragene and Keytruda and TAR-200 and cretostimogene and ANKTIVA; there are a lot of drugs being developed in this space. Yet many patients are still using gemcitabine and docetaxel because the other drugs have not been approved yet or are more problematic to give in the clinic. Many patients are kind of out in the cold. They are not able to get access to these drugs, either the newer drugs or drugs like gemcitabine and docetaxel. In terms of efficacy, as mentioned, there are many studies looking at intravesical chemotherapy and demonstrating efficacy. However, we know that formulations like TAR-200, which elude over three weeks work better than single agents. I think this combination, which has the advantage of being easy to deliver and sustainable, could be superior to agents that only remain in your bladder for just one hour.

Sergio Traversa, CEO

Thank you, Dr. Lotan. Uy, did that answer your question?

Uy Ear, Analyst

Yes. So, maybe just a follow-up on what you guys said in response to potential differentiation. So, maybe Dr. Lotan, if you are still there, maybe one of the feedbacks that we have gotten from investors is that this is kind of a crowded market. So, maybe just help us understand how you see NDV-01 fit in the treatment paradigm when it comes to market, you have BCG, you have CG Oncology and other potential competitors who could be ahead. Thanks.

Yair Lotan, Chief of Urology and Oncology

Right. I think I am happy to respond. First of all, I think that if you ask patients, they want to keep their bladder. In the BCG unresponsive space, which I completely agree, there are probably three or four potential treatments. TAR-200 and cretostimogene will likely be accepted by the FDA. Nonetheless, patients are frequently going to want two or three lines of therapy, and they are going to want to get sort of the most effective treatment. I don’t necessarily think that’s going to be the best first place to go with this drug mainly because, as you say, it’s going to be a bit of a busy space. Even though I suspect that since many people are already using gemcitabine and docetaxel as their main treatment off-label, if they actually have an approved compound that they are familiar with, with durable excretion of the drug and an easier mechanism of delivery, then they will be very open to giving that drug they are familiar with over some of the other agents. On the other hand, in the intermediate risk space, which has a higher prevalence than the BCG unresponsive space, there really aren’t any commonly used drugs. Intravesical gemcitabine is available, but not approved. As I said, it’s hard to get access to. So, academic centers provide intravesical chemotherapy, but many community sites don’t. It would be a very natural fit to give intravesical chemotherapy such as this formulation for intermediate risk patients. It also has potential in the chemoablative space, even though that’s not a common area for drug use, but UGN-102 is doing a chemoablation trial and it’s going to the FDA. It’s a single drug, mitomycin. This is actually a combination that could potentially compete nicely if it performs well. There is a Bridge trial comparing gem-doce to BCG that’s being enrolled right now. If it shows equivalence or superiority, then this drug could fit in the BCG naive space. The other drugs you mentioned, TAR-200 and cretostimogene are not competing in that area. The trials that have been completed with BCG and checkpoint inhibitors have shown that crest has reported about a 7% increase in recurrence at 18 months but about a 15% rate of Grade 3 SAEs and no improvement in progression or survival. I don’t think any of the checkpoint inhibitors are going to compete in the BCG naive space. But if the Bridge trial shows equivalence of efficacy, this drug could fit in the BCG naive space without much competition from some of these newer agents. I see many potential uses right now.

Uy Ear, Analyst

Okay. Thank you.

Sergio Traversa, CEO

Thank you, Dr. Lotan. And Uy, your second question was regarding the manufacturing. Sorry, was for sepranolone or for NDV-01?

Uy Ear, Analyst

For NDV-01.

Sergio Traversa, CEO

Yes. Clearly, the quantity needed for commercial use will be large. We always want to have at least two manufacturers. So, we are looking for capacity and a second manufacturer for risk management. It’s not a complicated product to make; it’s a gel and so all the components are well known.

Uy Ear, Analyst

Okay. Thank you.

Maged Shenouda, CFO

Good afternoon. This is Matt Barcus on for Andrew. Thanks for taking our questions. I guess, regarding the latest data set for NDV-01 presented at the AUA meeting earlier, when should we look forward to you sharing the complete response rate for the entire population? And how do you anticipate sharing the future updates from the program? Like what more can we look forward to in those data sets throughout the year? And what are your expectations for success?

Sergio Traversa, CEO

Well, I can answer part of it, and maybe Dr. Lotan can expand. So, the next data point will be the six-month data. We had seven patients now at the AUA with a 100% complete response. We will have six-month data on the 20 patients somewhere around the end of June or July. We will present that and then, subsequently, we will give nine months and twelve months of data on this cohort. These are the expectations. We can only look at what we have now, which is like 90% at three months and 100% of the seven patients at six months, but they look pretty good. Not surprisingly, as it’s known that the combination of gemcitabine and docetaxel is very efficacious. Even if, like with the duration of tumor contact of a couple of hours, we use the same dose and it stays there for 10 days and is done six times in three months. The expectation that the results are good is definitely there. Would you like to add something, Dr. Lotan?

Yair Lotan, Chief of Urology and Oncology

No, I think this is obviously an interesting cohort from an efficacy standpoint. I actually think the more important aspect of it is actually the safety standpoint because there is a lot of data about efficacy of gem-doce formulations. We know that you could look even at TAR-200 data and see what happens when you give gemcitabine over a sustained period. But the safety is actually the more important component because you worry whether or not prolonged exposure of the bladder to the chemotherapy might cause irritation, frequency, urgency, pain. And so far, we haven’t seen that. That’s probably the most reassuring aspect of this. It’s a heterogeneous population. It will be a little challenging to compare this to some of the mature trials like Sunrise-1 or Bond-3 in terms of efficacy because only some of these patients have CIS, BCG unresponsive CIS. This is still Phase 2 with a heterogeneous population. At some point, once we have our conversation with the FDA, we can decide on which indication to actually do a larger cohort. But the safety profile is obviously quite reassuring.

Sergio Traversa, CEO

Thank you. Thank you, Dr. Lotan. Did that answer your question? There was the first part that I didn’t catch entirely.

Matt Barcus, Analyst

No, yes, you caught it. Thanks.

Sergio Traversa, CEO

Thank you.

Matt Barcus, Analyst

And then I guess, as you are thinking about talking with the FDA on the data and the design of the Phase 3, what would you want the Phase 3 to look like in terms of time points, endpoints, and the types of patients you are thinking about enrolling?

Sergio Traversa, CEO

Dr. Lotan, if you want, you can add a lot of value because Dr. Lotan is helping us very closely to design the Phase 3 program. Would you like to answer that?

Yair Lotan, Chief of Urology and Oncology

Sure. I think there are easier routes and there are harder routes. I think somebody highlighted the challenge with the BCG unresponsive route. The benefits of that route are that the FDA has approved single-arm Phase 2 trials for approval in CIS alone to look at efficacy. The challenge is that these patients are relatively rare and it takes many sites and quite a bit of time to enroll. I think there are two easier routes. One route would be to go through a single-arm chemoablation route, similar to what UroGen did with the Envision trial. I think we are going to learn a lot later on this month when it goes to ODAC. If their drug combination gets approved with a single-agent mitomycin that stays in your bladder about four hours, then a single-arm trial in that setting with our formulation makes a lot of sense. It would be probably the quickest route to approval. If that doesn’t work, and there is reasonable rationale from the FDA that they won’t approve such an approach, then a randomized trial like PIVOT-6 in intermediate risk randomizing NDV-01 to placebo or observation would probably be the next quickest route. That trial actually enrolled extremely quickly in the U.S. I think they are almost done with enrollment, and I think somewhere around 15 months to 18 months would provide valuable data.

Matt Barcus, Analyst

Great. Thanks for the color.

Sergio Traversa, CEO

Thank you.

Operator, Operator

There are no further questions at this time, so this will conclude today’s conference. You may disconnect your lines at this time, and thank you for your participation.

Sergio Traversa, CEO

Thank you all. Thank you very much. Thank you, Dr. Lotan.