Relmada Therapeutics, Inc 10-K for FY2021

Relmada Therapeutics, Inc. (RLMD)

10-K 2022-03-25 For: 2021-12-31

Added on April 09, 2026

About this 10-K

Relmada Therapeutics, Inc filed this 10-K on March 25, 2022, covering the fiscal year ended December 31, 2021 (FY2021).

Headline figures

Fiscal year ended December 31, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Net loss: $125.75M; compared with a net loss of $59.46M a year earlier

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Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock ($.001 par value)		RLMD		The NASDAQ Global Select Market

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging Growth Company	☐

Item Number and Caption		Page

Forward-Looking Statements		ii

PART I

1.	Business	1
1A.	Risk Factors	13
1B.	Unresolved Staff Comments	32
2.	Properties	32
3.	Legal Proceedings	32
4.	Mine Safety Disclosures	32

PART II

5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	33
6.	[Reserved]	34
7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	34
7A.	Quantitative and Qualitative Disclosures About Market Risk	38
8.	Financial Statements and Supplementary Data	38
9.	Changes in and Disagreements with Accountants on Accounting, and Financial Disclosure	38
9A.	Controls and Procedures	38
9B.	Other Information	39
9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	39

PART III

10.	Directors, Executive Officers, and Corporate Governance	40
11.	Executive Compensation	40
12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	40
13.	Certain Relationships and Related Transactions, and Director Independence	40
14.	Principal Accounting Fees and Services	40

PART IV

15.0	Exhibits, Financial Statement Schedules	41

	Day 2						Day 4						Day 7						Day 14
	LS Means Difference		P-value		d		LS Means Difference		P-value		d		LS Means Difference		P-value		D		LS Means Difference		P-value		d
REL-1017 25mg vs Placebo		-1.9		0.4340		0.3		-7.9		0.0087		0.9		-8.7		0.0122		0.8		-9.4		0.0103		0.9
REL-1017 50mg vs Placebo		-0.3		0.9092		0.0		-7.6		0.0096		0.8		-7.2		0.0308		0.7		-10.4		0.0039		1.0

	●	Compelling lead product opportunity, REL-1017 currently in Phase 3 trials for the adjunctive and monotherapy treatment of MDD.

	●	Robust, and highly statistically significant, efficacy seen with esmethadone in a randomized Phase 2 trial, the primary endpoint at 7 days, with onset of action seen at 4 days, and the effect carrying through to 14 days (7 days post-treatment).

	●	Completed Phase 1 safety studies of esmethadone and strong clinical activity signal in depression established in three independent animal models in preclinical studies.

	●	Potential in additional multiple indications in underserved markets with large patient population in other affective disorders, and cognitive disorders.

	●	Scientific support of leading experts: Our scientific advisors include clinicians and scientists who are affiliated with a number of highly regarded medical institutions such as Harvard, Cornell, Yale, and University of Pennsylvania.

	●	Substantial IP portfolio and market protection: approved and filed patent applications provide coverage beyond 2033.

	●	our potential inability to continue to undertake preclinical studies, pharmaceutical development and clinical trials,

	●	our potential inability to obtain regulatory approvals, and

	●	our potential inability to manufacture, sell and market our products.

	●	delay commercialization of, and product revenues from, our drug candidates; and

	●	diminish the competitive advantages that we may have otherwise enjoyed, which would have an adverse effect on our operating results and financial condition.

	●	delays in identifying and agreeing on acceptable terms with prospective clinical trial sites;

	●	slower than expected rates of patient recruitment and enrollment;

	●	unanticipated patient dropout rates; and

	●	increases in time required to complete monitoring of patients during or after participation in a clinical trial.

	●	recruiting and enrolling patients to participate in a clinical trial;

	●	obtaining regulatory approval to commence a clinical trial;

	●	reaching agreement on acceptable terms with prospective clinical research organizations and trial sites;

	●	obtaining approval of the institutional review board (IRB) at each site selected for participation in our clinical trials;

	●	investigator fraud, including data fabrication by clinical trial personnel; and

	●	diversion of controlled substances by clinical trial personnel.

	●	failure to conduct the clinical trial in accordance with regulatory requirements or in accordance with our clinical protocols;

	●	inspection of the clinical trial operations or trial site by the FDA or other regulatory authorities resulting in the imposition of a clinical hold;

	●	unforeseen safety issues; or

	●	inadequate patient enrollment or lack of adequate funding to continue the clinical trial.

	●	the federal Anti-Kickback Statute prohibits, among other things, persons and entities from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, order or recommendation of, any good or service, for which payment may be made under federal healthcare programs such as Medicare and Medicaid. A person or entity does not need to have actual knowledge of the federal Anti-Kickback Statute or specific intent to violate it in order to have committed a violation;

	●	HIPAA imposes criminal and civil liability for, among other things, knowingly and willfully executing or attempting to execute a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters. Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;

	●	the federal Physician Payment Sunshine Act requires applicable manufacturers of covered drugs, devices, biologics, and medical supplies for which payment is available under Medicare, Medicaid, or the Children’s Health Insurance Program, with specific exceptions, to report payments and other transfers of value provided during the previous year to physicians, as defined by such law, physician assistants, certain types of advance practice nurses, and teaching hospitals, as well as certain ownership and investment interests held by such physicians and their immediate family, which includes annual data collection and reporting obligations;

	●	analogous state and foreign laws and regulations, such as state anti-kickback and false claims laws, may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors, including private insurers; and some state laws require pharmaceutical companies to comply with the pharmaceutical industry’s voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government and may require drug manufacturers to report information related to payments and other transfers of value to physicians and other healthcare providers or marketing expenditures; and

	●	changes in our industry;

	●	competitive pricing pressures;

	●	our ability to obtain working capital financing;

	●	additions or departures of key personnel;

	●	limited “public float” in the hands of a small number of persons whose sales or lack of sales could result in positive or negative pricing pressure on the market price for our common stock;

	●	sales of our common stock;

	●	our ability to execute our business plan;

	●	operating results that fall below expectations;

	●	regulatory developments;

	●	economic and other external factors;

	●	period-to-period fluctuations in our financial results; and

	●	inability to develop or acquire new or needed technology or products.

Equity Compensation Plan Information
Plan Category	Number of securities to be issued upon exercise of outstanding options and stock appreciation rights		Weighted- average exercise price of outstanding options and stock appreciation rights		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
	(a)		(b)		(c)
Equity compensation plans approved by security holders		10,330,622	$	22.52		222,320

Equity compensation plans not approved by security holders		-		-		-

Total		10,330,622	$	22.52		222,320

	●	Increase in study costs of $31,673,300 associated with the execution of three Phase 3 trials and open label extension safety study;

	●	Increase in manufacturing and drug storage costs of $3,823,100 related to materials needed to complete the Phase 3 program;

	●	Decrease in pre-clinical and toxicology expenses of $2,501,900;

	●	Decrease in compensation expense of $955,500 due to lower employee-related costs;

	●	Increase in stock-based compensation expense of $11,787,400 of stock-based compensation expense related to the options granted to employees and the issuance of warrants to consultants during 2021; and

	●	Increase in other research expenses of $10,822,500 primarily associated with additional consultants contracted to assist in the execution of our Phase 3 trials.

	For the Year Ended			For the Year Ended
	December 31,			December 31,
	2021			2020
Cash used in operating activities	$	(91,873,395	)	$	(27,808,801	)
Cash used in investing activities		(54,118,036	)		(34,447,648	)
Cash provided by financing activities		187,939,473			28,473,327
Net increase/(decrease) in cash and cash equivalents	$	41,948,042		$	(33,783,122	)

	(1)	pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company,

	(2)	provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors, and

	(3)	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements.

	Page
Report of Independent Registered Public Accounting Firm	F-2

Consolidated Balance Sheets as of December 31, 2021 and 2020	F-3

Consolidated Statements of Operations for the Years Ended December 31, 2021 and 2020	F-4

Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2021 and 2020	F-5

Consolidated Statements of Cash Flows for the Years Ended December 31, 2021 and 2020	F-6

Notes to Consolidated Financial Statements	F-8

	As of			As of
	December 31,			December 31,
	2021			2020
Assets
Current assets:
Cash and cash equivalents	$	44,443,439		$	2,495,397
Short-term investments		167,466,167			114,595,525
Lease payments receivable – short term		86,377			79,457
Prepaid expenses		11,301,535			903,190
Total current assets		223,297,518			118,073,569
Fixed assets, net of accumulated depreciation		-			1,258
Other assets		28,293			25,000
Lease payments receivable – long term		-			86,377
Total assets	$	223,325,811		$	118,186,204

Commitments and Contingencies (Note 9)

Liabilities and Stockholders’ Equity

Current liabilities:
Accounts payable	$	11,192,502		$	8,346,475
Accrued expenses		3,868,423			4,256,983
Total current liabilities		15,060,925			12,603,458
Total liabilities		15,060,925			12,603,458

Stockholders’ Equity:
Class A convertible preferred stock, $0.001 par value, 3,500,000 shares authorized, none issued and outstanding		-			-
Common stock, $0.001 par value, 50,000,000 shares authorized, 27,740,147 and 16,332,939 shares issued and outstanding, respectively		27,740			16,333
Additional paid-in capital		513,304,258			284,881,716
Accumulated deficit		(305,067,112	)		(179,315,303	)
Total stockholders’ equity		208,264,886			105,582,746
Total liabilities and stockholders’ equity	$	223,325,811		$	118,186,204

	2021			2020
Operating expenses:
Research and development	$	90,621,570		$	35,972,731
General and administrative		35,081,922			24,865,942
Total operating expenses		125,703,492			60,838,673

Loss from operations		(125,703,492	)		(60,838,673	)

Other income (expenses):
Interest/investment income, net		1,199,077			1,399,225
Realized loss on short-term investments		(636,012	)		(156,213	)
Unrealized (loss) gain on short-term investments		(611,382	)		139,267
Total other (expenses) income, net		(48,317	)		1,382,279

Net loss	$	(125,751,809	)	$	(59,456,394	)

Net loss per common share – basic and diluted	$	(7.16	)	$	(3.81	)

Weighted average number of common shares outstanding – basic and diluted		17,552,738			15,594,228

	Common Stock				Additional Paid-in			Accumulated
	Shares		Par Value		Capital			Deficit			Total
Balance – December 31, 2019		14,457,013	$	14,457	$	235,522,746		$	(119,858,909	)	$	115,678,294
Stock-based compensation expense		-		-		20,777,272			-			20,777,272
Equity offering, net		427,700		428		19,791,216			-			19,791,644
Warrants exercised		1,159,989		1,160		8,055,256			-			8,056,416
Cashless exercise of warrants		42,475		42		(42	)		-			-
Options exercised		155,558		156		735,358			-			735,514
Cashless exercise of options		90,204		90		(90	)		-			-
Net loss		-		-		-			(59,456,394	)		(59,456,394	)
Balance – December 31, 2020		16,332,939	$	16,333	$	284,881,716		$	(179,315,303	)	$	105,582,746
Stock-based compensation expense		-		-		40,494,476			-			40,494,476
Equity offering, net		10,147,059		10,147		161,216,798			-			161,226,945
ATM offering, net		651,674		652		23,415,384			-			23,416,036
Warrants exercised		433,856		433		2,627,628			-			2,628,061
Options exercised		174,619		175		668,256			-			668,431
Net loss		-		-		-			(125,751,809	)		(125,751,809	)
Balance – December 31, 2021		27,740,147	$	27,740	$	513,304,258		$	(305,067,112	)	$	208,264,886

	2021			2020

Cash flows from operating activities
Net loss	$	(125,751,809	)	$	(59,456,394.00	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		1,258			3,752
Stock-based compensation		40,494,476			20,777,272
Realized loss on short-term investments		636,012			156,213
Unrealized loss (gain) on short-term investments		611,382			(139,267	)
Change in operating assets and liabilities:
Lease payment receivable		79,457			73,091
Prepaid expenses and other assets		(10,401,638	)		(479,327	)
Accounts payable		2,846,027			7,823,812
Accrued expenses		(388,560	)		3,432,047
Net cash used in operating activities		(91,873,395	)		(27,808,801	)

Cash flows from investing activities
Purchase of short-term investments		(222,981,675	)		(182,051,630	)
Sale of short-term investments		168,863,639			147,603,982
Net cash used in investing activities		(54,118,036	)		(34,447,648	)

Cash flows from financing activities
Principal payments of notes payable		-			(110,247	)
Proceeds from issuance of common stock		184,642,981			19,791,644
Proceeds from options exercised for common stock		668,431			735,514
Proceeds from warrants exercised for common stock		2,628,061			8,056,416
Net cash provided by financing activities		187,939,473			28,473,327
Net increase (decrease) in cash and cash equivalents		41,948,042			(33,783,122	)
Cash and cash equivalents at beginning of the period		2,495,397			36,278,519

Cash and cash equivalents at end of the period	$	44,443,439		$	2,495,397

	2021		2020
Supplemental disclosure of cash flow information:

Cash paid during the period for:
Interest	$	-	$	2,415
Non-cash investing and financing transactions:
Cashless exercise of warrants for common stock	$	-	$	42
Cashless exercise of options for common stock	$	-	$	90

	Year ended December 31,		Year ended December 31,
	2021		2020
Common stock warrants		3,208,777		2,670,633
Common stock options		10,330,622		3,905,737
Total		13,539,399		6,576,370

	December 31, 2021		December 31, 2020
Insurance	$	353,300	$	527,600
Research and Development		10,708,800		291,800
Legal		11,000		11,000
Other		228,400		72,800
Total	$	11,301,500	$	903,200

	Useful lives	December 31, 2021			December 31, 2020
Computer and software	3 years	$	16,700		$	16,700
Less: accumulated depreciation			(16,700	)		(15,400	)
Fixed assets, net		$	-		$	1,300

	Number of Shares			Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding and expected to vest at December 31, 2019		3,615,602		$	19.96		9.2	$	74,837,043
Granted		1,000,000			39.50		9.3		-
Exercised		(253,927	)		-		-		-
Forfeited		(455,938	)		-		-		-
Outstanding and expected to vest at December 31, 2020		3,905,737		$	24.32		8.4	$	48,952,339
Granted		7,057,004			21.15		9.8		-
Exercised		(174,619	)		-		-		-
Forfeited		(457,500	)		-		-		-
Outstanding and expected to vest at December 31, 2021		10,330,622		$	22.52		9.0	$	46,088,534
Options exercisable at December 31, 2021		2,140,490		$	20.99		7.3	$	19,511,463

	Years Ended			Years Ended
	December 31,			December 31,
	2021			2020
Risk free interest rate	0.59 to 1.31		%	0.36 to 0.83		%
Dividend yield		0	%		0	%
Volatility		97-101	%		101-108	%
Expected term (in years)		5 to 6.25			6.25

	Number of Shares			Weighted Average Exercise Price Per Share
Outstanding at December 31, 2019		3,646,870		$	6.83
Issued		250,000		$	33.32
Exercised		(1,211,199	)	$	7.27
Forfeited/Expired		(15,040	)	$	16.80
Outstanding at December 31, 2020		2,670,633		$	9.11
Issued		972,000		$	31.98
Exercised		(433,856	)	$	6.06
Outstanding at December 31, 2021		3,208,777		$	16.45
Warrants exercisable at December 31, 2021		2,767,246		$	13.92

	Year Ended		Year Ended
	December 31,		December 31,
	2021		2020
Research and development	$	15,835,900	$	4,038,500
General and administrative		24,658,600		16,738,800
Total	$	40,494,500	$	20,777,300