Relmada Therapeutics, Inc. (RLMD) Earnings Call Transcript & Summary

Well, thanks, everyone, for joining us. We're really pleased to have the team from Relmada with us, Sergio Traversa, CEO; and Caroline Cotton, Communications Manager. With that, Sergio, maybe we'll start with the pivotal [ Rev3 Phase III ] trials coming this year. But before we start with that, maybe just for people who may not be as familiar, if you could remind us on the profile that you've seen so far with REL-1017 -- will make you so excited about it.

Sure. Well, Andrea, first of all, thank you for the invitation and thanks, Goldman Sachs, and good morning all good afternoon for the people that are on the other side on the East Coast. And profile of REL-1017. We're talking about CNS, we are talking about depression and both monotherapy and adjuvant or adjunctive treatment of depression. The profile, what we have seen in Phase II is the data that we have in our hands that we hope to repeat in the Phase III program is a very nicely tolerated safe drug. We have seen no real severe or worrisome side effect and feature we have seen a very rapid action. I got 7 days. We had highly statistically significant different from placebo. And we had 30% of the patient on the drug were in remission. That has been unseen in the depression space. The Phase II data was only 7 days on drug and 7 days no drug. But also we have seen a sustained efficacy because patients on drug, they did continue to do very well also day 14, there was 1 week after the drug treatment was interrupt. So rapid acting and extended or sustained efficacy. Phase III, then we'll go more in detail, but it's a little bit of a different design in terms of length of the study, right? The FDA believe -- strongly believe that depression is episodic, but chronic illness, and they are more interested in drug that have a prolonged effect. And so they gave us the mandate to show efficacy at the 28 or 4 weeks of treatment as a primary end point. And -- but day 7, if we hit as a secondary endpoint, it would carry the claim of rapid acting. So chronic treatment for depression rapid acting.

Perfect. Well, maybe let's put some numbers to what you saw in the Phase II. And just help provide some context for how that compares to other antidepressants that are currently under development or on the market?

Yes. I mean there are 28 or 29 different anti-depressant approved in the United States. And -- but despite there are so many drugs, the market is still highly underserved and main reason is that the vast majority of this antidepressant they work pretty much the same. So they all inhibitor reuptake of some neurotransmitter cerotonin or epinephrine dopamine with some exception that one in particular, this Johnson & Johnson esketamine, Travato is the brand name that is d-isomer or ketamine that is NMDA receptor antagonist or channel blocker, same as well as REL-1017. That have shown the biggest delta in term of efficacy versus placebo that look at different trials, 4, 5 points delta on the Madra scale. That is the scale that is used to measure the severity of the pressure. And the -- pretty much all the other traditional antidepressant, they show an efficacy profile between 2 and 3 points, Delta [indiscernible] drug and placebo. The data that the Phase II overall 1017 has shown a have been honest seen in the depression space, right? At day 7 and day 14, the delta between placebo and the drug was 8 points for an FX size depending at the different point of time of 0.7 to 0.9. So clearly, an efficacy profile very, very superior. So everything that is available as of today with the exception of esketamine, that it's clearly effective, but carry also a big package of side effect psychotomimetic side effect and is a hospital drug. You have to -- cannot be taken at home has to be administered in clinic where the patient is to stay for 2 or 3 hours, very minimum and for 2x a week. So there's some other limitation in terms of efficacy, it's probably the one that is resembled the most REL-1017.

Sure, makes sense. So maybe digging into the Phase III trial and the design here, and you've alluded to differences between the Phase II and the Phase III and some of these include duration of the study, the formulation, the treatment setting, maybe walk us through, I guess, what gives you the confidence that you'll still see an intact profile when you see this Phase III data? And which one of those parameters you might be most?

Well, which of the parameters they worry me the most. Well, I'm always worried about everything. So -- but in terms of like the one that is the biggest difference from Phase II is clearly the length of -- the duration of the treatment. We go from 7 days on therapy plus 7 days, no therapy to 28 days on therapy. Now what makes us confident and comfortable that there is no loss of efficacy for REL-1017 is that although we don't have direct data for REL-1017, we have data about other NMDA channel blocker, namely Otsuka with a combination of dextromethorphan and Kenedi, and we also have seen recently, the publication of another competitor that combined Wellbutrin with dextromethorphan. And in both these cases, we have seen no loss of efficacy. Esketamine is not a good example because as intermittent is a nasal spray an intermittent treatment. So the duration of efficacy, it's really bit less is more difficult to judge. But for the other 2 dextromethorphan adhesion an NMDA channel broker as well, they have been shown no loss of efficacy over time. we do believe that REL-1017 won't lose efficacy over time.

Got it. And then remind us the size, the study size differences between the Phase II and Phase III, I guess how much risk is there? And obviously, depression trials are difficult placebo responses are notoriously kind of killers of trials like.

Yes. But the number of -- well, Phase II was 62 patients, 3 arms and was an in-clinic for half of the trial outpatient for the second part of the trial. Phase III is each trial in the treat 1, 2 and 3 RELIANCE I and 2 is adjunctive adjuvant therapy, RELIANCE 3 is monotherapy. It is the one that -- with the result that we expect to come first. And so we go from 62 patients in 10 sites to up to 364 patients per trial in 110 sites. So clearly, there is a difference. These are all outpatients. So the variability will increase because more patients, more sites, but there is also some advantage in the Phase III. And we do believe that the biggest advantage is we go from 3 arms to 2 arms and from inpatient to outpatient. And the reason that we do believe that these are advantageous feature of the Phase III program is that the enemy of depression trial ever trial, but of depression trial, in particular, is the placebo effect. And that's what we've been trying to keep under control as the best we can. And in patients that was the Phase II usually carries a higher placebo effect. Outpatient is the Phase III should have some advantage in terms of placebo effect. And there is a direct correlation between the placebo response and the number of arms and doses in the trial. So -- and we go from 3 doses -- sorry, 2 doses plus placebo, 3 arms in Phase II to 1 dose and placebo or 2 arms in Phase III. That also should help to keep the placebo effect under control. So I would say that is a balance by more variability, but there is some advantage, too.

And then just remind us here on the study powering and then what were the assumptions you were making on placebo?

Yes, that's a great question. So thanks, Andrea. We have been conservative right? We did not -- we do not -- we don't have the luxury, but we didn't also don't want to do what large pharma tend to do. So I believe a company to develop an SSRI 7 trial, with 2 and that are positive J&J also, they had like 5 [indiscernible], which 2 ended up positive. With this strong Phase II data, we wanted to get it right the first time. And so we have designed a statistical plan conservative. And conservative means that we go from having 8-point delta on the Madrascale difference between placebo and the drug in Phase II to a statistical plan that is designed to detect 2 points of delta between placebo and the drug for an FX size of 0.35 that is half the 0.7 that we have seen in Phase II. So very conservative. We have made some assumptions on the placebo effect. So we assume the delta from baseline to day 28 for a placebo effect of 12 points on the Madrascale. And in Phase II, the drug had 17 points delta from baseline.

How important is -- you've spoken about this rapidity of action, and obviously, we've been hearing that from other players in this space as well. Just from your experience, how important is that for physician as they're prescribing that to their patients.

Yes. We heard mixed answers or mixed feelings about it. The prescribers they don't focus a lot on the -- like the number, the delta between drug and placebo. The drug is approved, they will try it and we'll make up their own experience. It's the 28 drugs approved for the price. So physicians, psychiatrists, they know how to use them and they have experience with them. What the clinician that sees patients is more focused on is the rapid as because the -- all the traditional antidepressant take like 3, 4 up to 8 weeks before they show any efficacy and they tend to work in 1 out of 3 patients. So the profile is not ideal to have a drug that after 7 days shows a big difference from placebo and with 30% -- 3 out of 10 patients in remission after a week is something that for the clinician would be -- it's very important. The FDA actually has a different point of view, and they are their own reason. They consider Rapid act in a very important feature. But there are not much interested in the drug, they only work for a week or 2, and then it loses efficacy. So at least in our case, they were very clearly guiding or you have to be positive at day 28.

Got it. Maybe digging into that in terms of the feedback that you've received from physicians. As they've seen REL-1017's profile emerge, just would love to hear maybe what you're hearing from them and characterize their level of excitement?

Well, yes, the -- for the clinician that treats patients, it's a little bit early, so also from my past experience, a doctor that prescribes drugs and treat patients usually interested in the drug when it is available. He is not available. It's different to capture the attention. Then the academic and KOL level, it's -- I believe it's very high. And everybody wants to see the Phase III data. It's Phase II was 62 patients, so it was a reasonable size Phase 2, but Phase III is a few hundred. So that will make the difference. So clearly, the expectations are very, very high.

I guess maybe from your experience then, how are you thinking about where REL-1017 would fit into the treatment paradigm? And maybe characterize for us what the patient profile would look like.

Yes. So clearly, the Phase III data will guide the real position of the drug. We can make some assessment based on the Phase II data. And there are 2 sets of indications like monotherapy and adjunctive. Adjunctive treatment of depressor adjuvant is when a patient fail at least one traditional antidepressant treatment and then REL-1017 is added 1 tablet in the morning on top of the existing treatment. And there is no antidepressant approved for this indication. There are only 3 drugs approved and they all 3 antipsychotic. So clearly, price power and positioning, that would be natural. If we repeat what we have seen in Phase II ,in the 2 adjuvant trial Phase III, there would be like the main positioning. Monotherapy initially was not a real focus, but the FDA encouraged going straight directly into a Phase II program for monotherapy. The monotherapy positioning will be much more driven by data because as monotherapy, there is a very strong competition, not in real term for like efficacy and -- but there is competition in term of price. Most of the drugs with one exception, they are generic. And so the data should be very strong to justify a payer to support like a first-line treatment for REL-1017. That may happen. It may happen. So if it happens, then it will be the old spectrum of the indications. So be frontline treatment and the adjunctive treatment.

So maybe help us understand, I guess, maybe this thought to expand to the monotherapy indication. What drove that? How has the nature of your discussions with the FDA have been on this front?

Yes, the -- what drove that was one very simple item, right, was safety. There is no efficacy data yet for REL-1017 as a monotherapy. But we provided the FDA with a big package of preclinical and safety from the Phase I and there is a big need for new effective drug, a new mechanism of action in depression. And so the conversation we proposed initially a Phase II then in Phase III and the FDA was -- they didn't -- they were okay with that tell you yes, go ahead. And but they said, we don't have any problem with that.

Does that imply that if this study that's coming in the next couple of months in monotherapy is positive, would that be included in your subsequent submission?

Most likely.

Okay. So only 1 single monotherapy trial would be needed.

We do believe. So clearly, it depends on the other -- the results of the 2 adjuvant treatment. So by any chance, we have not. And we don't believe so, but by any chance, they don't show positive results and 1 monotherapy trial will not be enough. But in at least 1 of the 2 adjunctive works. We hope they will both work. But if only 1 works, then we'll have 2 positive trials. There would be enough for filing and enough or potentially getting approval.

Got it. How should we think about REL-1017 potential as monotherapy? Because to your point, we haven't seen data from Relmada on this front, but help us, I guess, maybe think about what we should expect?

Yes, it is -- that one will be really driven by the data. If Phase III will show similar data to Phase II, then it's going to be very difficult for a payer not to support right REL-1017 is a monotherapy, rapid-acting chronic treatment, 1 tablet today, outpatient very well tolerated and would be right, clearly the best-in-class of any antidepressant.

I guess, mechanistically, is there any reason to think that -- I mean, we've seen adjunctive REL-1017 data. Is there any reason to believe that the baseline antidepressant is contributing to that benefit? I guess just in terms of teasing out exactly the contribution from REL-1017?

Yes. We get that question a lot. And sometimes you have to say that we don't know and we don't know. Scientifically talking with the inventor and the scientists, there is not a lot of rationale clinic or scientific to justify a synergistic effect between an SSRI and NMDA channel blocker. So -- and if we just based on science, the answer would say no. But it's -- we'll see. We'll see the clinical ultimately what matters. The clinical data we will show.

Got it. And then on the other side of that, do you expect any read-through from the monotherapy trial that will obviously read out before your 2 pivotal trials?

Well, I would say and I'm being a little optimistic here. That's not my nature. But I would say that if monotherapy is successful, I strongly believe that adjunctive will be successful.

Remind us on the trial design for monotherapy, is it still that same 28 days or is it a different set up in the [indiscernible].

Correct. It's exactly the same as the adjunctive -- the only difference in the patient population, right? Monotherapy is patients that have not been on an antidepressant for at least 30 days, adjunctive, they have to be on a fixed dose of an antidepressant for 6 weeks before to be randomized and enrolled in the trial as adjunctive.

Perfect. And then they're coming on to a new antidepressant, they're initiating a new one or they're just unstable?

No. They on the one, they've been stable for 6 weeks.

Okay. And then are the powering assumptions? Are they similar to the [indiscernible].

[indiscernible]

And then, I guess, you've spoken about there is -- there would be a much higher bar for monotherapy in terms of the efficacy, just given what the landscape looks like. If you could characterize, I guess, are there numbers you could put to that? Or how would you characterize that significant benefit?

It's a little early. You have probably noticed that we brought on board Gino Santini, is a very well-known and very successful commercial and strategic adviser, and he will help us to guide us to the commercial assessment. And the -- but again, the data will drive, right, what the real potential will be. Adjunctive, we have the data from Phase II. Clearly, it's a very, very strong market. It's 4 million to 5 million patients, 40% of the patient population in the production in the United States is about 15 million. It's already taking a combination the combination treatment. And so we expect that, that market with no competition from other antidepressant will be like addressed by REL-1017. Monotherapy is more, more difficult to assess without the data.

Perfect. Of course. Maybe when you think about the profile for REL-1017, one big question has been for so long, what the abuse potential could be or the liability there? You've completed 2 studies now evaluating that do you think that answers -- do we have the answer basically from those 2?

This answer we do. The data really black and white are very clear. This one was the most extensive abuse potential abuse risk program ever done. And the reason is that REL-1017 is a chemical resembles with racemic methadone that is used for pain and the treatment of -- maintenance of drug abuse because it's an opioid. REL-1017 is not an opioid, but we had to show it to the FDA at 2021 or 2022 standards. The data were already available from some old studies and that's what driven the NDA statement that is already out there. The states that REL-1017 is exempt from abuse potential risk and respiratory depression. But these data were old. And so we read on everything following the 2017 FDA guidance on the abuse. And sorry, the other -- the reason there was also a large program is that mechanistically, it's the same or very similar to ketamine, ketamine they are scheduled. So we had to show both that it does not have any opioid on narcotic effect and it does not have any psychotomimetic effect. And we did it. We did in vitro. We did animal studies with 2 large human abuse potential study; one versus oxycodone, the other one versus ketamine. And they also like a very clear profile. REL-1017 is statistically different from oxycodone and statistically different from ketamine in terms of likability and is statistically equivalent to placebo in both studies. So we feel very comfortable about that.

I guess, based off of those results and the research you've done, the people you've spoken to characterize express your baseline assumptions your schedule 4 initially? Or do you think you can be scheduled 5?

Well, the schedule 4, 5 is interchangeable, right? There is really no practical for the prescriber, it is no different. There is some difference for where the farmers keep the drug or how many samples you can give away. But prescribing doesn't make any difference. So either one would be very good. We will apply for Schedule 5. Although if you look at the profile of the drug, it should be a nonscheduled drug, right? There is a very clear example that I can mention here that came up the second human abuse potential study, right? That is the dextromethorphan. The dextromethorphan is an NMDA antagon is very similar to REL-1017, but with a very difficult PK profile. So that's why you have to combine it with something that inhibits the metabolism extend the half life. REL-1017 does not have that issue. And so we included dextromethorphan in the second human abuse potential study, and not as a control. The FDA does not consider dextromethorphan as a control, but we wanted to see the data and how the profile of REL-1017 looks like versus the dextromethorphan, even if it's not an official control. And dextromethorphan has shown statistically significant more likability than REL-1017. Dextromethorphan is an over-the-counter behind the counter drug widely used as a cop zero. So I believe that we give a clear answer that this drug, REL-1017 should not be a scheduled drug, but these are processes that take time. And so in the interest of time, we will apply for a scheduled 5 initially.

Got it. Remind us what that process is like. So you go to the -- I guess, you submit for this to be a schedule 5. How does that work to potentially get your drug descheduled and what agencies need to be involved here?

Yes. Well, it's a complex process that the involved, the FDA, actually, subdivision of the FDA called CSS, control substance division that work with the FDA, and they analyze all the data available that we have provided to the FDA and they will provide a recommendation and an assessment to the DEA. The DEA, the Drug Enforcement Agency is the one that has the final say and they will determine what schedule it is. This determination will be -- the FDA will provide the assessment to the DEA at the approval, the time of approval of the drug and the DEA has 90 days making assess their own assessment and give an answer within 90 days after approval.

How confident are you that the data you've generated to date will be sufficient for them to make a favorable decision here?

Well, we are fairly confident. We followed by the book, the 2017 guidance of the FDA. And we will discuss -- we will have a pre-NDA meeting at some point and maybe toward the end of the year in the fall after we will have some Phase III data to discuss. And at that time, we will also discuss what by chance, they want to see anything more about the abuse. We already discussed the preclinical and it's done. And -- but the abuse we haven't discussed it because the data have been generating more recently. And they wanted to see the old data package, not just one by one. So at that time, we'll have some feedback. But we did everything is written in the guidance.

Okay. Any questions from the audience? Maybe one last one on REL-1017. Any plans to expand into other indications where it might make sense?

NMDA channel blocker, they can have like a wide range of indication as NMDA system is involved with a lot of different aspects from like neuropathic pain to Parkinson's, attention deficit. So the -- potentially the use could be expanded to other indications to be very open, depression is, by far, the largest indication is the one where there is a very, very strong unmet need. And it is the one also that it takes pretty much 100% of our time. So right now, we don't have any plan to expand the indication. Eventually, after depression, it could be interesting to look at something.

I guess maybe on that point, just touching on really quickly the acquisition of that was completed. Maybe speak a little bit about that, what interested you particularly about this asset? And how do you balance the development work that's needed there with clearly focus on the execution for REL-1017?

Right. So we acquired the global perennial rights from Abromentis the intellectual property related with some aspect of psilocybin. That is very different from what everybody else is working on psychedelic and then I will go a little bit more in detail on the differences. But there was an opportunistic acquisition. There was the -- Abromentis was pressured by you may imagine by the other player in psychedelic to sell the IP and the early work that they have done. And so we don't want to lose that opportunity because it's right in our sweet spot. And the underlying -- the base for right, the interest and the acquisition is that psilocybin is a 5h-2a agonist, so serotonin the serotonin receptor and it act as a neuroplastic agent, same as REL-1017 as an MMDA channel broker. So they both improve like the physiology of the communication and the rights of the brain cells. So the common ground is neuroplastic effect that can be reached with 2 different pathways. And the was -- the timing was opportunistic was not a big investment in terms of economics because it's very early stage. But at some point, it could become very attractive. Now the big difference between what is our program on psilocybin compared to everybody else is that the belief is that there is no need of a psychedelic or psychotomimetic call it triple effect to have a therapeutic effect. And I believe we are the only one that is going in that direction. And we do believe that very low dose, psilocybin taken chronically, can produce the same effect of like a bonus and with the psychotomimetic event. And that would make a lot easier to prescribe. And so there would be no potential for any kind of abuse and safety also is very important. So the area that we are looking for psilocybin low dose is neurology, neurodegenerative diseases versus other groups that are looking at psychiatry. So that's not the psychiatry program. And specifically, we have not defined the specific indication yet because we are expecting some preclinical data on rodent and zebrafish. And that we will discuss with the FDA that the goal is to show that there is in neuroplastic effect that has been already shown in the past, but we want to have our own proprietary data. And based on that, we will go in more detail on what kind of indication. There is some orphan indication that could be very suitable. And specifically, we are looking at improvement of recovery after acute nerve injury and there is no treatment. They would be very, very interesting. And it all depends if the FDA will accept. Well, first, the preclinical data and the safety package that is already out and on the public domain for psilocybin. If these 2 components or these 2 items will be successful, then theoretically and practically, we could be in Phase II by end of this year or beginning of next year.

Got it. And then I guess as you think about that, that opportunity that you have with Abromentis. Should we expect that you will continue to look outwards and continue to do deals like this or was this a one-off?

There's one-off being very straight and direct was an opportunistic. We have enough on the table with REL-1017 and low-dose psilocybin that keep us very busy.

Perfect. Well, with that, thank you, everyone, for joining us. Thank you, Sergio. Thank you, Caroline.

Thank you. It has been a pleasure, and good rest of the morning and the afternoon for everybody. Thank you.