Greetings and welcome to Vistagen Therapeutics' Fiscal Year 2024 Third Quarter Financial Results and Corporate Update. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce Mark McPartland, Senior Vice President, Investor Relations at Vistagen. Thank you, you may begin.

Thank you, Doug. Good afternoon, everyone and welcome to Vistagen's fiscal year 2024 third quarter corporate update conference call and webcast. This afternoon we filed our quarterly report and issued a press release providing an overview of our recent third quarter results and our neuroscience pipeline development. We encourage you to review the release, which can be found in the Investors section of the Vistagen website. During today's call, we will make forward-looking statements regarding our business based on our current expectations and information. Forward-looking statements speak only as of today and except as required by law, we do not assume any duty to update in the future any forward-looking statement made today. Of course, forward-looking statements involve risks and uncertainties and our actual results could differ materially from those anticipated by any forward-looking statements we make today. Additional information concerning risk factors that could affect our business and financial results is included in our fiscal year 2024 third quarter Form 10-Q for the period ending December 31, 2023, and in future filings that we make with the SEC from time to time, all of which are or will be available on our website and the SEC's website. Now with that taken care of, I'd like to thank and welcome all of our stockholders, analysts, and everyone taking an interest in Vistagen. I'm joined on the call today by Shawn Singh, our Chief Executive Officer; Cindy Anderson, our Chief Financial Officer; and Josh Prince, our Chief Operating Officer. Shawn will provide an overview of our recent results and our progress across our key pipeline programs. A brief opportunity for questions from our sell-side analysts will follow the prepared remarks. I would like to remind everyone this call is being webcast and will be available for replay after completion. The replay link can be found in the Investor events section of the Vistagen website. I would now like to turn the call over to our Chief Executive Officer, Shawn Singh. Shawn?

Thank you, Mark, and good afternoon, everyone. Thank you for joining our call today. At Vistagen, we are pioneering neuroscience to create first-in-class therapies for psychiatric and neurological disorders, addressing the significant needs of patients whose mental health and well-being are negatively impacted by these conditions, where there are few effective FDA-approved treatment options. Our clinical-stage neuroscience product candidates aim to establish new standards of care and significantly improve patients' daily lives. Recently, we've witnessed a resurgence in neuroscience, highlighted by pharmaceutical M&A activity in the neuropsychiatry sector, valued at around $23 billion. We are encouraged by the renewed interest in innovative late-stage product candidates with unique safety profiles, indicating potential for impactful neuropsychiatry programs. Each of our clinical neuroactive pherines, particularly fasedienol for treating social anxiety disorder, is rooted in innovative neuroscience and aims to develop distinctive product profiles across various therapeutic areas, including anxiety, depression, women's health, and other disorders. Today, we will briefly review our progress and plans for three of our five pherine assets in our clinical-stage neuroscience pipeline: fasedienol, itruvone, and PHAD. Our leading program, fasedienol, seeks to transform treatment for adults with social anxiety disorder, which affects around 10% of the US adult population, substantially impacting their daily lives. Despite the rising prevalence of social anxiety disorder, no FDA-approved acute treatment option exists to help individuals manage their anxiety quickly and safely when faced with daily stressors. Following positive results from our PALISADE-2 Phase 3 trial reported last year and with a solid balance sheet, we are dedicated to advancing our PALISADE Phase 3 development program for social anxiety disorder and preparing to initiate all key remaining studies for that program this year. Since our last conference call in November, our team has been focused on launching PALISADE-3, our next Phase 3 clinical trial for fasedienol, which is set to begin in the first half of 2024, followed by PALISADE-4 in the latter half of this year. Both trials will replicate our successful PALISADE-2 trial, involving a public speaking challenge in a clinical setting and utilizing patient-reported outcomes on the Subjective Units of Distress Scale as the primary efficacy endpoint. We believe that either PALISADE-3 or PALISADE-4, if successful, along with the positive results from PALISADE-2, may provide substantial evidence of the effectiveness of fasedienol for a potential NDA submission for treating anxiety in adults with social anxiety disorder. Last year, we achieved a significant milestone by demonstrating positive Phase 3 results in an anxiety study for a drug candidate that does not require systemic administration or direct neuronal action in the brain. We are eager to resume clinical activities with PALISADE-3 and advance our mission to provide a first-in-class therapy in the neuropsychiatry market, which demands differentiated fast-acting therapies without the risk of sexual side effects, weight gain, or concerns about abuse liability. Beyond fasedienol, we are exploring various strategies to unlock the significant potential of itruvone as a new therapy for major depressive disorder. We are actively planning a potential US Phase 2B trial of itruvone model therapy in this area. Our goal remains clear: to deliver a differentiated therapy that transforms the standard of care without the risks mentioned before. We also recognize the significant potential of our hormone-free PHAD nasal spray. Its promise is based on the positive results from two unreported trials in women's health that we shared last year: one focusing on vasomotor symptoms related to menopause and the other on managing premenstrual dysphoric disorder. PHAD demonstrated statistically significant outcomes in both trials. We are preparing to undertake the non-clinical studies required to submit a US IND to facilitate further Phase 2 clinical development of PHAD for women’s health indications, including treating moderate to severe hot flashes associated with menopause. I'll now turn the call over to our CFO, Cindy Anderson, to summarize some of the highlights from our financial results for the third quarter of our fiscal year 2024.

Thank you, Shawn. As Shawn mentioned, I will highlight a few financial results from our fiscal year 2024 third quarter. I also encourage everyone to review our quarterly report on Form 10-Q filed with the SEC earlier this afternoon for additional details and disclosures. Research and development expense was $4.5 million and $6.9 million for the three months ended December 31, 2023, and 2022 respectively. The decrease in R&D expense was primarily due to a decrease in clinical and development expenses related to the timing of such expenses incurred in our Phase 3 trials of fasedienol and FAD. General and administrative expense was $3.8 million for the three-month period ended December 31, 2023, compared to $3.1 million for the prior period. The increase is primarily due to the increase in compensation-related expenses. Our net loss attributed to common shareholders was $6.3 million and $9.8 million for the three months ended December 31, 2023, and 2022 respectively. At December 31, 2023, we had cash and cash equivalents of approximately $126.6 million. I will also note that this afternoon, as customary for development-stage companies in our sector, we filed a new shelf registration statement on Form S-3 with the SEC to renew a previous S-3, which was set to expire next month. Shelf registration statements on Form S-3 are standard in our industry and are intended to provide us with broad flexibility to improve our balance sheet in the future as may be needed. As a reminder, please refer to our core report on Form 10-Q filed today with the SEC for additional details and disclosures. I will now turn the call back over to Shawn.

Thanks, Cindy. So, as we wrap up today's call, I want to emphasize that we are very proud and very excited to be focused on reaching another key corporate milestone in the near term. That's the initiation of our PALISADE-3 Phase 3 trial of fasedienol for the acute treatment of anxiety in adults with SAD. We will progress through the next phases of our core corporate development strategies with confidence in our team's expertise to execute our PALISADE Phase 3 clinical program of fasedienol and SAD, the potential of our robust pipeline for multiple and diverse psychiatric and neurological disorders, and our steadfast commitment to pioneering neuroscience to develop and commercialize truly differentiated treatment solutions. So on behalf of our whole team here at Vistagen, I want to thank you for your continued support.

Thank you, Shawn. Operator, we would now like to turn the call over for questions from the sell-side analysts participating on the call today.

Our first question comes from the line of Paul Matisse with Stifel. Please proceed with your question.

Hi, this is Julian on for Paul. Thanks so much for taking our question. Just a quick one for me; are you still planning on doing a repeat dose study for fasedienol in SAD? And if so, would you be able to provide any color on that? Thanks so much.

You bet. Thanks, Julian. Yeah, we are going to do a repeat dose study. It'll be similar in design to PALISADE-3 and to PALISADE-4, and thus obviously by extension PALISADE-2. It'll be smaller and it'll assess the safety and potential benefit of a second dose of fasedienol that is administered within 10 minutes after the first dose and prior to the public speaking challenge. So, similar study design, similar endpoint, obviously much smaller and the result of that study, part of it is in agreement with the FDA, especially as to any potential safety issue, which we don't anticipate any with repeat dosing, but it really could inform the labeling and provide some guidance as to whether or not a second dose administered within 10 minutes, which might be the case in a real-world setting, is safe and, as we anticipated, could provide any potential benefit for some patients. So we'll prepare to initiate that study in the second half of this year as we've guided.

Excellent. Thanks so much.

Our next question comes from the line of Andrew Tsai with Jefferies. Please proceed with your question.

Hey, thanks. Good afternoon. Appreciate you taking my question. So maybe the first one on PALISADE-3, PALISADE-4, you're employing obviously some studying improvements to those programs. So could it be fair to assume that the SUDS separation in those studies could be even greater than what you saw in PALISADE-2 because, as you're mitigating for placebo effect, could you be further maximizing the drug effect?

Well, thanks, Andrew. As you mentioned, we've done quite a few things to further de-risk the Phase 3 program and a lot of lessons learned on the other side of the prior studies and obviously this is not now a study design and an endpoint that sites and investigators are seeing after a pretty long hiatus in the space of a couple of decades. So the things that we've done to improve surveillance, improve and further de-risk execution of the program, certainly that's a possibility. But there are a lot of things. If you compare the world in 2022 to where we are today in '24, just at a minimum taking masks out of the equation is a big difference. Having the ability to have in-person investigator meetings, have the ability to do things that ensure rigorous adherence to the protocol, very exacting requirements of that protocol consistently across sites. All those things combined have the potential, of course, to improve even on what we've seen in the past in Phase 2 and in PALISADE-2. Josh Prince, you want to add anything to that?

Sure, Shawn. Thank you. Yeah, I think we're very optimistic about our ability to execute a well-controlled study post-pandemic, and it's everything that you talked about, but it's also the things that we're able to do in terms of how we work with our CRO. We're putting feet on the ground in terms of our own monitors going to sites in addition to CRO monitors. We have some additional exclusion criteria to make sure that subjects that are coming into the study have the best chance to have positive results or opportunity to have positive results with fasedienol and even things such as eligibility review, making sure that subjects are appropriate subjects before they're going into the Visit 2 and Visit 3 public speaking challenges. So you put all those things together and it does give us a fair amount of optimism moving into PAL-3 and PAL-4 compared to what we had when we were executing PALISADE-1 and PALISADE-2.

Thanks. And maybe a follow-up on the repeat dose study that you're initiating in the second half. As we think about the three arms, what are you and the FDA looking for? Or said in another way, what is positive data to you?

Josh, go ahead and address that.

Yeah, we expect it to be a smaller study. So it's not at this point, we don't expect to see power for statistical significance like you would in the PALISADE-3 or PALISADE-4, but it would give us is, is there any indication that for some patients an additional dose within 10 minutes could provide some benefit and that essentially can inform the label. So, at the end of the day for us, a positive study is we either see that there is some indication that it could be a benefit or we don't, but either way, there's benefit from the first dose.

The discussions have focused on informing labeling downstream and gaining a real-world understanding, particularly from open-label activity where there may be a perception that more is better in a short period. First and foremost, we need to ensure safety, and we believe there is little to no risk associated with a second dose within that 10-minute window. For those unfamiliar, there are three arms before a public speaking challenge: placebo, placebo drug, and placebo drug, drug, where each of the second doses is given within 10 minutes of the first in front of public speaking challenges. Considering real-world scenarios, individuals might use the drug multiple times rather than waiting as the 15-minute study paradigm suggested. We'll see how it progresses. It's a conversation, and it's encouraging to discuss potential labeling benefits. Remember, these receptors are activated in milliseconds, so it doesn't require much time for them to respond initially.

Our next question comes from the line of Tim Lugo with William Blair. Please proceed with your question.

Thanks for the question and congratulations on the progress. For fasedienol, given a non-systemic, non-abusable profile, and with a positive PAL-2 trial, could you look to gain breakthrough status with the agency? Is it something you're exploring? If you were to get breakthrough status, is it something that could impact your development path at all? And in your discussions with the agency, do you have enough, maybe I guess preclinical data around abusability or enough animal data around abusability to have that included in the label?

Thanks, Tim. Appreciate those questions. So, first as to BTD or breakthrough, look, that's always an aspiration of any company that's got something in a space that we've got. It's always an advocacy matter with the agency. I think, like I said, we just got done doing something we don't think anybody else has ever done that we've seen and we've certainly got a product profile potential that is different than anything that we see out there. We know the agency is worried about the potential high abuse of benzodiazepines given their drug safety communication on that during COVID. We also know that unfortunately, social anxiety disorder and other anxiety disorders lead to depression, and then lead, unfortunately, with increasing prevalence that we are seeing to suicidal ideation. So we already know we have fast-track. It doesn't mean that you necessarily fall into breakthrough, but certainly something on our mind. And you're right too that it is important whether or not we see this drug as potentially being scheduled. As we addressed a while back, especially with a drug that is administered intranasally, one might think, well, is there some abuse potential there? As we know from the preclinical work we've done and that we submitted to the FDA and also clinical work, a large body of work, including the open-label study with about 500 subjects and over 30,000 doses, we just were not seeing TEAEs or certainly no SAEs that are usually associated with abuse liability, even in the longer-term open-label. Mechanistically, it makes sense because the drug isn't taken up systemically and most importantly, based on the GABA study that we did preclinically and the C14 studies that we did, there's not tissue distribution and direct activity on the abuse liability receptors in the brain, opiate, nicotine, dopamine, and the like, and not potentiating GABA like, say, a benzo would also work in our favor. So I think we're very confident as we continue to see clinical data support the preclinical data and the whole package that says this is a differentiated safety profile because of the MOA. We're confident in a go-forward where patients could have the ability to access the drug online on a recurring basis with the drug potentially not being scheduled and no REMS. So we'll see how that continues to go, but what we saw in PALISADE-2, again, no TEA more prevalent than 2%. In the large open-label study, nothing more prevalent than 5% other than headache at 8.7%. So that's remarkably different than what we often hear when we're listening to commercials and side effects that are associated with particular therapeutic options.

There are no further questions in the queue. I'd like to hand the call back to Mark McPartland for closing remarks.

Thank you again, everyone for participating in the call today. Again, if you have any additional questions, please do not hesitate to contact us by email at [email protected] or contacting the individuals listed in our press release issued earlier today or the contact section of our website. Again, we also encourage you to register for email updates on our website to stay connected with the latest news from Vistagen and any future events. Thank you for participating in the call today. We appreciate everyone's interest and support. We look forward to keeping you current on our continued progress. This concludes the call. Have a tremendous day.

Ladies and gentlemen, this does include today's teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day.