Thank you for standing by. This is the conference operator. Welcome to the Ramada Therapeutics Second Quarter 2021 Earnings Call. As a reminder, all participants are in listen only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask I would now like to turn the conference over to Mr.
Tim McCarthy from LifeSci Advisors. Please go ahead.
Thank you, Rachel, and thank you all for joining us this afternoon. With me on today's call are Chief Executive Officer, Sergio Traverza and Chief Accounting and Compliance Officer, Chuck Hence. This afternoon, RailMata issued a news release providing a business update and announcing financial results for the 3 6 months ended June 30, 2021, and filed its quarterly report on Form 10 Q with the SEC. 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, Rail Moda'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 Braumada's press release issued today and the company's SEC filings, including in the annual report on Form 10 ks for the year ended December 30, 2020 and subsequent filings. This conference call also contains time sensitive information that is accurate only as of the date of this live broadcast, August 10, 2021. Ramada 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. Good afternoon, and as always, and to everyone. I'm pleased to welcome to Remada's Q2 2021 conference call. On today's call, I will provide an update on the comprehensive development program for our lead product candidate for the adjunctive treatment of depression, REL-ten seventeen, highlight the substantial market opportunity for this compelling product candidate and review upcoming milestones. Following this, I will turn the call over to Jaganz, Chief Accounting and Compliance Officer, for a review of the for neurodegenerative indication.
With that, I'll begin to by reiterating the significant news shared last week in our top line results from the abuse of human potential or HAP study evaluating rel1017 versus oxycodone 40 milligrams as the active control. As many of you already know, rel1017 is also known as that is the Baxter or right side isomer or racemic method. While there is considerable existing published data supporting a lack of clinical relevant opioid effect, including a very clear statement from the Drug Enforcement Agency, the DEA, we conducted this work for FDA guidance and as it is commonly done for CNS Active Drug. To support the comprehensive data package for our new drug application or NDA for relp1017 is an adjunctive treatment for MDD. Importantly, our study was designed in a manner that followed the FDA 2017 guidance on the assessment of the reduced potential of drugs.
Top line results for the primary endpoint showed that all three doses of rel1017 evaluated in recreational opioid users demonstrated a highly statistically significant difference versus those rating for oxycodone 40 milligrams. Notably, the highly statistically significant difference was confirmed between the active control and 150 milligrams of rel1017, which is the maximum tolerated dose and is 6x the proposed therapeutic dose. The results for the secondary endpoints, which included scores for global overall liking and the desire of taking the drug again were consistent with those of the primary endpoints. They demonstrated no evidence of any meaningful abuse potential. More specifically, the results demonstrated that route1017 was similarly highly statistically significant in differences versus oxycodone at all doses and the placebo results were consistent with approved drugs that are unscheduled, Schedule 4 or Schedule 5.
The secondary endpoint data further strengthened the overall results of the study and are important in that they also inform the FDA's review of the future NDA for rel=ten seventy. We believe that these collected results have addressed any residual concern regarding human abuse liability as a potential risk for SBA approval by establishing clear separation from the active control that is a scheduled to new opioid agonist. In addition, the results for RAL1017 in comparison to placebo were comparable or better to those achieved by many drugs that have been FDA approved as either unscheduled, Schedule 5 or Schedule 4. I would like to note that we are again joined today by Doctor. Charles Gorodetsky, that is the former Scientific Director of the National Institute of Drug Abuse Addiction Research Center.
Doctor. Gorodensky will be available to answer any questions in regard to the hep study during the Q and A session. With that, I will now provide an update on RELIANCE, the ongoing Phase 3 program for rel=ten seventeen, which consists of 2 sister, 2 arm placebo controlled pivotal study, RELIANCE 1 and RELIANCE 2, each of which will include 364 participants per study across 55 subs. It also includes RELIANCE OLS, the long term open label safety study, which is enrolling both rollover participant from the pivotal study as well as the novel participants. As a reminder, these studies are designed to evaluate REL1017 as an adjunctive treatment for major depressive disorder or MDD and includes two arms, placebo and 25 milligrams of rel1017, both of which are on top of standard antidepressant treatment for participant who have already unsuccessfully tried a minimum one and up to 3 existing antidepressant therapy.
The primary endpoint is change in the MADRS score at day 28. Key secondary endpoints include the change in MADRAS score at day 7 and change in CGIS, the clinical global impression severity score at day 28. Both RELIANCE I and RELIANCE II are progressing with top line data expected in the first half of next year. RELIANCE OLS, the long term safety study is also ongoing and enrolling participant as planned. Data from this long term open label safety study will be part of the NDA filing package.
In addition, we have started dosing in Reliance 3 to evaluate the use of rel=ten seventeen as a monotherapy for MDD. As a reminder, the most significantly different between this trial and the ongoing clinical study is the population. The planned MDD monotherapy study will consist of individuals who are diagnosed with depression and have not currently taking standard antidepressant therapy. We anticipate completing the study prior to the conclusion of RELIANCE 1 and RELIANCE 2. Moving on, planning for our 2nd human abuse potential study, this one assessing REL1017 versus intravenous ketamine, which has been an established history as an effective positive control and is ongoing.
We will be the more precise on the timing of the top line results of this study in the next couple of months based on the speed of recruitment and broadly expect those results by the end of this year or Q1 of 2022. I wanted to take a moment to reaffirm the need for a new therapeutic option with the potential clinical profile that rel1017 presents. Depression is coming, But for many who suffer, current options are not effective enough. Over 17,000,000 individuals in the U. S.
Suffer from NTT, and there are currently limited therapeutic option to help these patients. Traditional antidepressant can take up to 4, 6 weeks to show efficacy and have significant side effects. Moreover, approximately 65% of MTD patients do not respond well to the first antidepressant treatment and approximately 30% of MDD patients do not respond to any of the current oral antidepressants. Adjunctive treatment options are crucial because they enable a change in therapy without requiring the significant time that SSRIs and other drugs require when switched agents to the withdrawal and other potential side effects. Despite these challenges, there are only currently 3 FDA approved adjunctive treatment for major depressive disorders, and all 3 of them are all antipsychotics.
Based on its novel mechanism of action and the collective positive data generated to date, including Phase II results that showed statistically significant, rapid and sustained antidepressant effect with a favorable safety and tolerability profile, we believe rel=ten seventeen has the potential to be the first oral antidepressant FDA approved for adjunctive treatment of MDD. I'm now passing the call over to Chuck for his review of the financials, and I will then touch on our recent acquisition of the development of commercial rights to a novel psilocybin and database program for neurodegenerative indication. Chuck, it's all yours.
Thank you, Sergio, and good afternoon, everyone. Today, we issued a press release announcing our business and financial results for the 3 6 months ended June 30, 2021, which I will now review. For the Q2 ended June 30, 2021, total research and development expense was approximately $17,300,000 as compared to $5,300,000 for the comparable period of 2020. The increase was primarily related to an increase in costs associated with the execution of a broader clinical program for REL1017. Total general and administrative expense for the Q2 ended June 30, 2021 was approximately $9,100,000 as compared to $7,400,000 for the comparable period of 2020.
This increase was primarily due to increases in personnel costs, stock based compensation and consulting services. For the Q2 ended June 30, 2021, we recorded a net loss a net loss of approximately $26,600,000 or 1 point dollars or $0.73 per basic and diluted share in the comparable period of 2020. Turning to the results for the 6 months ended June 30, 2021, total research and development expense was approximately $31,400,000 as compared to $9,800,000 for the comparable period of 2020. Again, the increase was primarily related to an increase in costs associated with the execution of a broader clinical program for rel1017. For the 6 months ended June 30, 2021, general and administrative expense was approximately $17,500,000 as compared to $12,900,000 for the comparable period of 2020.
The increase was primarily due to increases in personnel costs, stock based compensation and consulting services. For the 6 months ended June 30, 2021, we recorded a net loss of approximately $48,800,000 or $2.90 per basic and diluted share, compared to a net loss of $21,800,000 or $1.45 per basic and diluted share in the comparable period of 2020. On June 30, 2021, the company had cash, cash equivalents and short term investments of $109,100,000 compared to $117,100,000 on December 31, 2020. We continue to expect that this strong cash position will support us through at least the multiple data readouts we anticipate through the first half of twenty twenty two. I will now hand the call back to Sergio for his further remarks on the most recent progress.
Sergio?
Thank you, Chuck. Last month, we announced the acquisition of development and commercial rights to another psilocybin and derivative program from Arbormentis for all ex Asia territories, including U. S. And Europe. At this time, you will have to bear with us, we cannot share too much about the program for competitive reasons.
But importantly, what we can share is that this program will focus on neurodegenerative disorders and is distinct from and complementary to the rel=ten seventeen program, which is focused on psychiatry. This agreement expand our development pipeline and in particular leverages our core expertise in mechanism of neuroplasticity, but at the same time expand our work into indication outside of depression and psychiatry. In summary, RELATE1017 development program remains on track and was recently further derisked by the results of the HAP oxycodone study that were consistent with our studies to date and confirm the extensive body of literature indicating the lack of abuse potential of rel=ten seventeen. Looking ahead, we anticipate multiple key data readouts over the next 12 months and then have added a potential long term growth driver with the acquisition and development of commercial rights to another psilocybin and derivative program. Importantly, as Chuck noted, our robust R and D initiatives are supported by a strong balance sheet.
In closing, I remain grateful to the Remelo team for their continued hard work and dedication to executing our mission. I would like to extend also my sincere thanks to the participants and clinical partners involved in the rel=ten seventeen clinical trials for their effort in advancing this important therapy through the clinic and as expeditiously as possible. We'd also like to thank Doctor. Gorodesky for being able to participate to these calls. And Doctor.
Gorodesky is one of the well recognized authority in the oil field for abuse and narcotics and so on. And it would be it is a great opportunity if there is any question regarding our study that to be addressed to Doctor. Gorodetsky to get an educated and very credible answer. We can now open all the call for questions. And operator, can you please open up?
Thank you. We will now begin the question and answer session. Your first question comes from Mark Goodman from SVB Leerink. Please go ahead.
Sergio, can you remind us where the 55 sites are of RelianceOne, just kind of break down U. S. Versus OUS and just give us a sense of whether everything's kind of moving forward as you had planned. I mean, obviously, COVID is having some impact again on a bunch of clinical studies out there. So just curious how it's doing there with your study.
And second, just curious, are you working with the same people at FDA in the division that you were working with at the beginning who signed off on your Phase 3 program? And the reason I ask is we've had a couple of setbacks recently at other companies and just sometimes it's because there's changes at FDA and so I'm just kind of checking the box, making sure there's no changes there? Thanks.
Thank you, Mark. Well, the first part of your question, it's easy. The 55 sites are all in the U. S. So we are a U.
S. Company. We have nothing no operation, nothing outside of the U. S. Except some collaboration with the very high end universities like in Switzerland and I believe in Italy too.
And so the but for development in all the sites in the U. S. How the study is going? Well, we started a few months ago. It is a large program.
We are actually running 4 different clinical trials now that we have finished with the human abuse potential study. So it's 2 Phase III, then there is a long term safety and then there is the monotherapy that just started at 8 days of recruiting. We will be more precise on the timing, but you're asking about the impact of COVID. We did not feel like the any major complaints or any major feedback from the sites about the impact of COVID. Now the last few months has been pretty quiet.
Now there is a little bit of a research. So we'll be more specific in the next 2, 3 months. But straight answer is that no, we don't expect any major delay or any major impact from the COVID. A lot of work is now done remotely, like the interviews for the Madras, they all most of them they are done remotely and both the operator, the raters and the patient actually like that. They don't have to go to the hospital.
I believe they go in our study, they go only once a week for 4 weeks. So it's 4 visits in the hospital. Taking your question on the FDA, we don't really know what happened. I believe you mentioned 2, one must be Acadian, the other one must be Axiom. And we don't really know what the specifics are.
What the way I can best answer the question is that the we do believe that these are specific topics related to the programs, not a general like approach from the psychiatry division. And from our perspective, we did not have any particular issue with the FDA. No delays, no question raised beyond the normal course of business. So we did not have any of these issue or topics so far. Clearly, we did not file an NDA yet.
So we cannot exclude everything. We'll know it when we file the NDA. But so far, the FDA, I would say, has been pretty benign in helping us how to develop this problem. One thing is they clearly recognize there is an issue there is a need for the initial. And so they've been extremely like cooperative.
I hope I answered all your questions in a satisfactory way. Thanks.
Thank you. Your next question comes from Andrea Tan from Goldman Sachs. Please go ahead. Hi, everyone. Thanks for taking the question today.
Sergio, maybe one for you. Can you provide more color on the nature of your discussions with the FDA regarding RELIANCE-three? Just wondering if this could be considered a registrational data set? And are you thinking that you would love to include the data within the initial filing package?
Thanks, Andre, for the question. I have to be a little soft on this one because the abuse data, they are very fresh and clearly they will be the FDA will look at this data and we will provide them as soon as we have something that is reportable to the FDA. The top line is not enough. And yes, there is the monotherapy, we don't have any data yet on monotherapy. So it would be a little bit aggressive to go directly to the FDA and to claim about starting Phase III and doing registration trials.
But we have now we have the HAP study, we have the animal study. So the package, the preclinical package and the special population is becoming pretty strong. So it's I cannot answer your question directly yet because I don't have the answer. But yes, there is a chance that we may do something different from the monotherapy and to make it a registration trial. The only difference would be to expand the number of patients, but it's a bit too early to give you the straight answer.
We will update everybody as soon as we get some certainty of what we can and what we cannot do.
Great. Thanks so much. Thank you. Your next question comes from Andrew Tsai from Jefferies. Please go ahead.
Okay, great. Thanks and good afternoon. Maybe a question for Chuck. Our understanding is the eventual scheduling of esmetadone or any drug out there will boil down to the 8 factor analysis. So I was wondering if you can talk about some of the, I guess, 7 other factors.
What are they? And then as it relates to them, talk about the strength of the data and evidence you've seen for esmethadone as it relates to those factors. And at the end of the day, are these factors equally weighted? Or does the abuse liability study carry more weight? And then I have a follow-up, please.
Thanks.
Chuck, is all yours, Chuck Gurodzinski.
Yes. I don't have the 8 factors in front of me, but I think that they would put a good deal of weight at this point on this abuse liability study. It's probably the single most predictive kind of study that you could run to predict before the drug gets on the market what the abuse is liable to be. And the preliminary data that we've seen so far in the analysis looks very, very positive as Sergio summarized it. So I and I think that there's no specific one of the factors that FDA keys on.
They'll look at the whole picture. They'll look at all of the data that we have. But I think they'll put a good deal of weight on a study like this one. It was done was very well done. It's the most recent methodology.
The statistical analysis follows all of their recommendations and the data looks very positive. This looks like a drug that has very low, if any abuse liability and is certainly consistent with either no scheduling, which would be difficult because of international treaty obligations or a very low level scheduling like in 405.
Makes sense. Thanks. And my second question is, I mean, to your knowledge, are there precedents where, I guess, the highest dose of a drug has shown, I don't know, 65 on VAS and ended up getting a favorable DEA scheduling. I know this is wrong to think about, but I just want to know if it's common, I guess, for a positive abuse liability study to kind of show and quote unquote shallow dose response, positive meaning that the drug ultimately got a favorable scheduling?
Well, handling that again, Yale, I think there are examples even within the opioids and there's certainly some examples within the anti epileptics and even an anti migraine drug where the drug is significantly different from a positive control as it was here with oxycodone, but may show a very slight liking and even that seems to be somewhat nonspecific so far and might show some difference from placebo and still be a very either on schedule again or schedule very low. I mean like the drug Faberzi, for irritable bowel, which did indeed show significant differences from placebo, even at doses that were only 2 or 3 times above the recommended therapeutic dose and still wound up and down on Schedule 4. So I think that there are certainly precedents for there being a very low abuse potential, but not necessarily absolutely 0, and still be consistent with very low scheduling.
Thanks for all the color.
Thank you. Your next question is from Joon Lee from Trust Securities. Please go ahead.
Hi, thanks for taking my question. Where are you in terms of enrollment for the ongoing RELIRIS programs? Are you on track to report top line data in the first half of next year? And do you expect data from RELIANCE 3 before RELIANCE 1 and 2. So, what does that mean?
And are we getting data really early next year, Q1 or Q2? I'd love to hear some color on that. And then can you remind us what the design of RELIANATE 3 is, the doses and the study arms used in that study? And that's a Phase 2, correct?
Thank you, John. Yes, I'll answer in the similar way or same way as Andrea at 10. The it's a bit too early to say how the recruitment is going, but clearly recruitment was maybe the data point that would make more sense because it is more a clear answer is the number of sites. And I have the number in front of me because I answered and to come prepared to the call. So we have 52 sites on 301.
Is the first one started very late in December. 27 sites already active, up and running in 302 and 10 sites in 3 0 3. So 3 0 3 is probably smaller, so it's normal to have a smaller site number. And we also started very recently. So I mean, the vast majority of the sites are up and running.
Consider that a good part of these sites they have shared, not many, but some on 301 and 302. So when the sites finish the or reach the top of the number of patients that they can enroll in 301, they will automatically switch to enrolling patient in 302. The long term safety study, it's open to everybody and including new patients. And the 303 that is the monotherapy, the reason that we say that it will be finished before is that I would not make major comment on the number of patients because we are still in the thinking process and mode and also with the FDA to see how to maximize the outcome and maximize the value of that trial. So we may expand the number of patients and make it a registration study, as I mentioned to Andrea.
And but the reason that we believe it will be finished early is that the recruitment of naive patients or patients that are not currently on antidepressant, it's much faster than as an adjunctive treatment. Is there a protocol? It's exactly the same. The only difference is the patient population. But clearly, there are more patients that are not on treatment and especially that are more willing to start with a new anti antidepressant than to add something to the current antidepressant.
So it's related with the not on the number of patients, but it's related to the speed of recruitment. So my answer is satisfactory. Yes, yes. We will update on the
Got it. And then for as a monotherapy, you think it's possible that you might want to consider higher dose or is higher dose still not really useful in your view, so 25 milligrams?
Yes. Thanks, John. No, it's the same dose. It's the same product of PrimaX with the difference in patient population. 25 milligrams, if you look at all the data from the very early animal studies to the Phase 2 and 25 milligram is the optimal dose, It's probably not very different from the 50 milligrams in thermal efficacy and in thermal side effect.
The reason of the 25 is not because of tolerability or safety or it's just the real reason is to reduce the placebo effect. Less arm, less placebo effect. So using only the 25, we only have 2 arms that is minimal placebo effect in terms of number of arms that we can have. And adding the 50, we don't believe could have increased the placebo effect, but would not have improved or increased the efficacy of the drug. So that's the real reason of choosing 25 and it is across the board.
All trials they use 25. Got it. Thanks so much for the color. Always a pleasure.
Thank you. Your next question is from Jay Olson from Oppenheimer. Please go ahead.
Hey, congrats on the progress and thanks for taking the questions. Have you seen any published reports of increasing diagnosis rates for MDD during the pandemic? And have you seen any differences between the baseline characteristics of patients enrolled in your studies versus previous MDD clinical trials? And then I had a separate question if I could.
Yes. Well, thanks, Jay. Thanks for the question. We have been reporting, I think somebody that we just spoke on the call published something on the very big increase in number of patients diagnosed for depression. And so it's yes, there are reports out that show that there is an increase up to like 400%.
That's hard to believe, but I read that number somewhere. In terms of the nature of the depression related with the pandemia, we don't I don't really see the patient profile they are enrolled. And so that's when I would pass. We have criteria for inclusion and exclusion and that I don't believe they're related with the pandemia or not. So I don't know if there has been a change in how the profile go to depressed patient change with the pandemia.
I assume probably some relation between the pandemia and some manifestation of depression that must be, economic crisis and jobs and so they all have an impact. And I do believe that I actually read it more than believe it, that COVID itself, that the virus has an impact on the brain and there could be some post COVID, not like non job related effect, but virus related effect on the how the depressed patients shows these symptoms. But would love to be able to give you a more specific question, but I don't really see the patient profiles or the patient involved.
Okay, great. Thank you. And then, could you talk about the differences between GABA and NMDA mechanisms since both appear to provide rapid onset of efficacy in MDD? And what would cause a physician to prefer one mechanism versus the other in MDD?
Yes. That's also a very good question. Well, yes, the end kind of going toward the same direction, but from opposite side, right? I believe one is in activate and the other one is an inhibitor. So it is pretty different in terms of mechanism.
Probably and this is just looking at the data available. Probably the biggest difference in what we believe physicians will prefer the NMNDA mechanism is that an NMDA tends to being stable or improve the efficacy over time, while the GABA does the opposite. And so the if it's true and the FDA strongly believe that the depression is a chronic illness, then you want to have a drug that you can take for a long time in terms of safety, but also that keep the efficacy or increase the efficacy over time. Great. Hope they answered your question.
Yes, it's perfect. Thank you.
Thank you. Your next question is from Yatin Suneja from Guggenheim Securities. Please go ahead.
Hey guys, this is Eddie on
for Yatin. Thanks for taking the question. So can you give us a little some more sense of how the RELIANCE trial is powered, specifically on the placebo arm, sort of how you're modeling what a placebo effect could be here? And what are
Eddie, I don't know if it's just me, but I only could hear the first like 22nd of your question.
Can you hear me better now?
Yes, much better, much better.
Yes, I was wondering if you could just help us with the power. Yes, yes.
Sure. I'll be happy to do that. So as you definitely remember the Phase II data, the effect size, it was something around 0.7, 0.9. Assumed that fluoxetine that I work with has an effect size of about 0.3 and it got approved. So the effect size of REL-ten seventeen was kind of 3 times what fluoxetine has.
Clearly, it's a Phase 2. So we don't want to although we believe we have an extremely effective drug, we didn't want to take too much risk. So we make a conservative assumption in the Phase III program across the board. Rule of thumb coming from the expertise, P, you lose about 25% of effect size when you go from Phase II to Phase 3 for a variety of reasons. But clearly, this loss of effect size can be modulated and it can be adjusted using, for example, like having only 2 arms instead of 3 in Phase III versus Phase II.
So that clearly makes should make a material difference. But even assuming the some loss of FX size, we wanted to be conservative. So we in the assumptions statistically assume that we'll have about half the FX size that we had in Phase 2. Got you. 0.7 to 0.35 to 0.4.
That should be conservative.
Okay. And then on the monotherapy study, like I said, are these naive patients or is there a certain washout period before their last sort of treatment of antidepressants?
Yes. I believe mostly they are naive. I do believe they are allowed to I don't remember the exact how much time they have to pass before they can get into the trial, but there is a considerable amount of time of washout before they can get into trial. As you know, it is now well known that my time when I was working on Fluoxetine, was not known, but SSRIs, they have a pretty significant withdrawal effect. So the last thing you want to do is to have a patient that is not only depressed, he gets into withdrawal effect from SSRIs.
So I believe in that. I don't remember, I can give you the exact number offline, but it's not a week or 2. It's like I believe it's 3 months or something like that or 2 months when they have to be clean, not taking any antidepressant before to get it.
Thank you. This does conclude the question and answer session. I would like to turn the conference back over to Sergio Traverza for any closing remarks.
Well, thank you, operator. Thank you all for joining us on the call today. We are pleased we have been pleased and we are pleased to share our recent progress with you and the rel=ten seventeen clinical development program. It continues to advance. We are excited about the important catalyst that lie ahead of us, and we'll keep you updated on clinical results and activity through the remainder of 2021.
Thank you again for joining us on the call and enjoy the rest of the day. Thank you.
Thank you. This does conclude the conference for today. Thank you for participating. You may now disconnect.