Good afternoon, ladies and gentlemen, and welcome to the Relmada Therapeutics, Inc. First Quarter 2024 Financial Results Conference Call. [Operator Instructions] 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 go ahead.

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 revision 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 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 continue to play a critical role. Moreover, the ongoing initiative we put in place to drive trial awareness with prospective patients are also 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 tweaks 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 in those patients in our second Phase III trial for REL-1017, Relight or Study 304. It also has a planned enrollment of approximately 300 patients.…

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 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'll now begin the question-and-answer session. [Operator Instructions]. Your first question comes from Marc Goodman from Leerink Partners.

This is Basma on for Marc. I have a question about the Reliance and Relight trials -- ongoing Reliance and Relight trials. You actually mentioned something that you were monitoring the trial, monitoring the -- looking at the blinded data before in the previous call in the fourth Q earnings call. Can you provide some color about those kind of blinded data from -- what do you see right now from the Reliance and Relight if you compare to the prior trial that had larger placebo response. Do you see any similarities, do you see any differences just to give us some color about this strategy that you implemented to reduce the placebo response?

Yes, sure. And thanks for the question. I'll give you like the top-down answer. And then we have Dr. Andy -- Andrew Cutler, he is our Clinical Advisor on the call, who'll provide a little bit more details about this aspect. Well, first, let me say something about the blinded data, right? There is absolutely no way to guess from the blinded data, the outcome of a clinical trial. And we did -- we've seen that in the last 2 trials that we had. So the help that we can get or everybody can get from monitoring the blinded data is only and exclusively to see there is something that is not like -- that doesn't make -- and I can find the right word, but that is not consistent, right? I'll give an example, if there are individual patients with the MADRS scores week-over-week, that goes 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 it doesn't respond is still consistent over the 4 weeks. So if you see a zigzag, that's a signal that something is not like -- it's not consistent. And so we take a look to that to the patients and mostly to the site. So that's really 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 is nothing we can do, but we can at least revise and advise the site that something is kind of like a red flag. And Andy, you are on the call, would you mind to provide some more details about it?

Yes. So I absolutely agree with what Sergio said. What you look for is consistency and quality indicators. And in addition to what he said about the primary, the MADRS zigzag, and you also look for consistency across different scales. The primary -- secondary -- the key secondary outcome, of course, being a CGI, usually that moves in the same direction as the MADRS, which is measuring depression symptoms. So you look for that. I would say also 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 really 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 point.

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 do see the inconsistencies that you've just spoken about, maybe walk us through what steps then 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 short answer and then Andy, if you would like to provide a little bit more details. But in general, well, first, you contact the site and you discuss like any details regarding patients or patients that has some inconsistency. And then you go through the old process. And ultimately, if that becomes a pattern, you don't want to have like a site that shows inconsistency in enrolling like 10, 20 patients because that would affect the old trial. So the ultimate measure is to close the site. But Andy, I'm sure I can give you a little bit 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 in that. So as you know, if one site has too many patients, 1 or 2 sites that can kill a trial. But also if you do see this -- well, first of all, the site also knows having run sites. The site knows now, if you're looking over my shoulder, you're going to call me". It really does make them be on their best behavior, if you will, and not cut corners. So -- but ultimately, we have closed down some sites that have quality issues. So ultimately what you do is you 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 you 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?

So the -- we will have -- not we, but the data monitoring committee will have a look at the data at some point, close -- 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 or if we have to expand the trial. So there is no early stock planned.

The other major function of the DSMB, of course, is to monitor safety. And the good news is the safety and the 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, closed or been able to even reopen using your monitoring real time analysis? And also we've...

Sorry, I can -- maybe it's me but I can barely hear you.

Okay. Can you hear me better now?

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

Okay, no problem. So yes, I was just asking continuing with like 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 -- we've seen quite a few companies that have announced delays for instance like schizophrenia and epilepsy spaces. And are you seeing any increased level of competition in terms of funding the right MDD depression patients? And then...

Thanks for the question.

Yes, thank you very much for the question. So in terms of site, right, the -- like the site selection is not like it's fixed, like the you decide 50, 60 sites at the beginning and you finish with the same site. It is an ongoing process. So constantly, there is a revision of sites and some site is closed, not only for quality issue also for like the competing studies or they exhausted the patient population that they can enroll into the site. So it is an ongoing. I don't have on the top of my mind like a real specific number, but it's not like that at some point you do a review. It's an ongoing process. So the -- maybe, Andy, when I finish the other answer, can give you a little bit more detail because he runs clinical sites. So he is more into the detail of the process. And the second question, would you mind to repeat it? The competition...

Yes. Just -- yes, exactly.

Yes. Well, there is clearly some competition out there. And the -- by the -- mostly -- I mean, usually, a site does not -- cannot or does not take on like 3, 4 studies that enroll the same kind of patients. In our case, it's a little bit particular because we are doing -- the studies are for adjunctive treatment of depression. So -- thus the competition is much less because the -- there are not many other programs, especially in Phase III that enroll patients in -- as adjunctive. We do believe there was 1 other company that finished 1 sizable big study a few weeks ago. And -- but I do believe that the majority of the sites that were outside the U.S., so there was relative competition. It was not an antidepressant anyway. We keep on hearing that the psychedelic, psilocybin, there are a lot of trials ongoing with psilocybin in depression that is not really a direct competitor, but still, it's -- it keeps the site busy. And it's high-dose psilocybin for PTSD and MDD. So -- to summarize, yes, there is competition, but we are like in a specific indication where the competition is much lower. Andy, would you mind to provide a little bit more color?

Yes. The second -- I'll answer the second one first, and that is that Sergio is exactly right. At the site level, you don't want to take too many competing studies. Usually, though, the study criteria are different enough that you can do, say, 2 or 3 depression studies without significantly impairing as a patient will more clearly fit into 1 protocol than another. So as far as the first question, I don't have the exact number of sites that we've closed down off hand, 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. And I think some of it is simply the process of overseeing the sites. Now the sites know that they're being watched. They know that we're monitoring quality and that 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?

The -- yes, it's very simple. We'll start with a Phase I single dose, ascending dose of psilocybin modified release. So the interesting part is the patient population or the technically Phase I you do it in a healthy volunteer. And -- but it's well known that psilocybin is a relatively safe product at high dose, and we are using a dose very, very -- much, much lower, like 120 or is the 130 of the dose that is used as a psychedelic for the treatment of psychotic diseases. So on the safety side, we feel extremely comfortable. And -- but the indication that we pursue for psilocybin is into the metabolic space. So obesity and glucose and fatty liver. So the data that we are looking for is the mostly PK data in obese patients. So the particular is the patient population that will be obese healthy volunteer. And we should start over the next month or 2, we said within the first half. So we are getting there. It's a short study. So the whole study will last like 3, 4 months, maximum.

[Operator Instructions]. Your next question comes from Uy Ear from Mizuho.

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

Charlie, thanks for the question. And so the -- yes, the screening failure is high, but we look at the reason for the screening failure and there are legitimate reasons, right? It usually is drug-drug interaction or concomitant -- mostly is concomitant medication. So yes, these are legitimate reason not to enroll in the study. And most of the screening failure they actually come from the site. And with that said, we are in constantly review and we listen very carefully to the feedback from the sites, and there is anything that we can do to increase the enrollment rate or decrease the screening failure but without decreasing the quality and increasing the risk of the trial, we have been doing that. So there are certain things that have been -- especially on the drug-drug interaction that -- or concomitant medication more than interaction that have been changing over time. So that should facilitate and this is a back end force from the company and the site. So they give us a feedback and we see patients with that characteristic that it could fit into the trial, but we cannot put it in because of the inclusion-exclusion. So we revised and in a dialogue with the FDA, of course, we have made a few like detailed revision of the protocol over time. So we don't know what we'll do to the screening failure. But definitely, there is a chance that we could get a little better. And the second question was at the beginning -- that's a great question, but I don't have the answer on the top of my head. And the screening failure on the -- at the beginning of III or II. Probably there are not like a lot of patients enrolled. So I don't know how much that number is meaningful. But maybe Andy or Maged if they have some more color on that -- the screening failure on the studies III or II before we amend the protocol.

I don't believe it was quite...

Yes, go ahead, Maged, sorry.

Go ahead, Andy. Yes, I don't -- it was certainly not quite as high. I don't want to put a number out there without confirming with our internal team. So we'll have to get back to you. So...

Yes, 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. Right. And -- yes, as we mentioned in some of our calls, right, the big -- one of the biggest change -- amendment we made to the protocol is that there is now a requirement for medical and pharmacy records, and that's by itself increased the screening failure. But also, at the same time, the -- you are relatively comfortable that, that patient comes from -- like from a doctor that has diagnosed and prescribed medication and that the patient has actually purchased the medication from this pharmacy. So the 2 things they go together, a high screening failure, but there is clearly 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. And in summary, we continue to firmly believe that we have an approvable drug in REL-1017, and we are excited by the potential of our novel psilocybin derivative program. We look forward to reporting further progress with our pipeline throughout the remainder of 2024. I do remain grateful to the Relmada team for their continued hard work and dedication to executing on 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. Thanks a lot to everyone for the attention and the interest and looking 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.