Relmada Therapeutics, Inc. (NASDAQ:RLMD) is a clinical-stage biotechnology company focused on the development of esmethadone (d-methadone, dextromethadone, REL-1017), an N-methyl-D-aspartate (NMDA) receptor antagonist, and a proprietary, modified-release formulation of psilocybin (REL-P11) for metabolic indications.

Business Overview

Relmada is dedicated to addressing areas of high unmet medical need in the treatment of central nervous system (CNS) diseases and other disorders. The company's lead product candidate, esmethadone, is being developed as a rapidly acting, oral agent for the treatment of major depressive disorder (MDD) and potentially other CNS conditions. Relmada is also advancing its novel psilocybin program, REL-P11, for the treatment of metabolic indications.

Esmethadone (REL-1017) for Major Depressive Disorder

Esmethadone's mechanism of action as a low-affinity, non-competitive NMDA channel blocker differentiates it from most currently approved antidepressants. By working through the same brain mechanisms as ketamine and esketamine but potentially lacking their adverse side effects, esmethadone is being developed as a rapidly acting, oral agent for the treatment of depression and potentially other CNS conditions.

In a randomized, placebo-controlled Phase 2 clinical trial, subjects in both the REL-1017 25 mg and 50 mg treatment groups experienced statistically significant improvement on all efficacy measures tested, including the Montgomery-Åsberg Depression Rating Scale (MADRS), the Clinical Global Impression – Severity (CGI-S) scale, the Clinical Global Impression – Improvement (CGI-I) scale, and the Symptoms of Depression Questionnaire (SDQ), with improvements appearing as early as Day 4 and continuing through Day 14, one week after treatment discontinuation.

Relmada is currently conducting two Phase 3 clinical trials, RELIANCE II and RELIGHT, evaluating REL-1017 as an adjunctive treatment for MDD. The company has made meaningful revisions to the screening and enrollment processes in these studies to enhance the probability of success, including implementing a comprehensive adjudication process to acquire medical and pharmacy records for all enrolled patients. Relmada expects to complete enrollment in RELIANCE II, which is planned to enroll approximately 300 patients, with top-line data anticipated in the second half of 2024.

Psilocybin Program (REL-P11)

In July 2021, Relmada acquired the development and commercial rights to a novel psilocybin and derivative program from Arbormentis LLC. The original focus of the program was on neurodegenerative diseases, but the company has since expanded its exploration to include metabolic indications.

Preclinical data in a rodent model of metabolic dysfunction-associated steatotic liver disease (MASLD) demonstrated beneficial effects of psilocybin on multiple metabolic parameters, including reduced hepatic steatosis, reduced body weight gain, and fasting blood glucose levels. Based on these findings, Relmada plans to initiate a single-ascending dose Phase 1 trial in obese patients in the first half of 2024 to define the pharmacokinetic, safety, and tolerability profile of its modified-release psilocybin formulation (REL-P11), followed by a Phase 2a trial to establish clinical proof-of-concept.

Financials

For the three months ended March 31, 2024, Relmada reported a net loss of 21.8 million, or 0.72 per basic and diluted share, compared to a net loss of 26.3 million, or 0.87 per basic and diluted share, in the same period of the prior year. The decrease in net loss was primarily driven by a reduction in research and development expenses, which declined from 15.9 million in the first quarter of 2023 to 13.3 million in the first quarter of 2024, as well as a decrease in general and administrative expenses from 12.3 million to 9.7 million over the same period.

For the full year 2023, Relmada reported an annual net loss of 98.8 million and had no revenue. The company's annual operating cash flow and free cash flow were both negative 51.7 million.

As of March 31, 2024, Relmada had cash, cash equivalents, and short-term investments of approximately 83.6 million, providing a comfortable runway into 2025 based on the company's current clinical development plan.

Key Upcoming Milestones

Relmada expects to achieve several key milestones over the next 12-18 months, including:

- Completion of enrollment and top-line data readout for the RELIANCE II study in the second half of 2024 - Initiation of a Phase 1 clinical trial for the modified-release psilocybin formulation (REL-P11) in obese patients in the first half of 2024 - Potential Phase 2a data for REL-P11 in the first half of 2025

Intellectual Property and Market Exclusivity

Relmada has an extensive intellectual property portfolio, including over 50 issued patents and pending patent applications related to REL-1017 that potentially provide coverage beyond 2033. The company has also secured an Orphan Drug Designation from the FDA for d-methadone for the treatment of postherpetic neuralgia, which, upon potential NDA approval, carries 7-year FDA Orphan Drug marketing exclusivity.

In addition to any granted patents, REL-1017 will be eligible for market exclusivity to run concurrently with the term of the patent for 5 years in the U.S. (Hatch Waxman Act) and may be eligible for an additional 6 months of pediatric exclusivity and up to 10 years of exclusivity in the European Union.

Risks and Challenges

As a clinical-stage biotechnology company, Relmada faces the inherent risks associated with drug development, including the potential for clinical trial failures, regulatory hurdles, and competition from other therapies. The company's ability to successfully develop and commercialize its product candidates is critical to its long-term success.

Additionally, Relmada's financial position, with an accumulated deficit of 582.7 million as of March 31, 2024, and negative operating and free cash flows, highlights the need for the company to continue securing additional funding to support its ongoing operations and pipeline development.

Conclusion

Relmada Therapeutics is a promising clinical-stage biotechnology company focused on addressing areas of high unmet medical need in the treatment of CNS disorders. With its lead candidate, esmethadone, in late-stage clinical development for MDD and its novel psilocybin program advancing into human studies, Relmada is well-positioned to potentially deliver innovative therapies to patients. However, the company must navigate the inherent risks associated with drug development and maintain a strong financial position to execute on its strategic priorities. Investors should closely monitor Relmada's progress as it continues to advance its pipeline and works towards potential regulatory approvals.