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spk03: Good afternoon, ladies and gentlemen, and welcome to the RealMata Therapeutics, Inc. third quarter 2023 earnings conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Wednesday, November 8th, 2023. I would now like to turn the conference over to Tim McCarthy of LifeSci Advisors. Please go ahead.
spk02: Thank you, Operator, and thank you all for joining us this afternoon. With me on today's call are Chief Executive Officer Sergio Traversa and Chief Financial Officer Maga Chinuda and Dr. Cedric O'Gorman, Chief Medical Officer. This afternoon, RealMata issued a press release providing a business update announcing financial results for the three and nine months ended September 30th, 2023. Please note that certain information discussed on the call today is covered under the Safe Harbors Provision of the Private Securities Litigation Reform Act. We caution listeners that during this call, RealMata'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 RealMata'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, 2022, and subsequent filings. This conference call also contains time-sensitive information that is accurate only as of the date of this live broadcast, November 8th, 2023. RealMata 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?
spk07: Thank you, Tim. As always, and good afternoon to everyone, and welcome to RealMata Third Quarter 2023 Conference Call. We have achieved some important clinical milestones recently in the ongoing Phase III program for REL 1017 in a major depressive disorder, MDD, as well as in our promising preclinical novel psilocybin program that I will briefly cover today. Following this, Magid will review the third quarter financial results, and then we will take your questions. Let's begin with an update on the Phase III program for REL 1017, which continues to proceed as planned. As a reminder, RealMata is focused on developing REL 1017 as an adjunctive treatment for MDD. As previously communicated, we have made critical changes to Reliance II, the ongoing Study 302, a Phase III two-arm placebo-controlled pivotal study evaluating REL 1017, 25 mg for adjunctive MDD. The amended 2D302 protocol has been implemented across all our clinical sites. Enrollment is progressing as we leverage our close relationship with the study sites and the number of ongoing initiatives to drive trial awareness with prospective patients. As a reminder, we are planning to enroll approximately 300 patients and continue to expect that Reliance 2 will be completed in the first half of 2024, most likely toward the end of the first half, so around mid-year. In the second phase 3 trial for REL 1017, named Relight or Study 304, we begin dosing patients during the third quarter. Relight also has a planned enrollment of approximately 300 patients. Completion of enrollment in this trial continues to be anticipated in the second half of 2024. To reiterate what we have said previously, like RELIANT-2, RELIANT is a randomized, double-blind, placebo-controlled four-week trial evaluating the efficacy and safety of REL1017 as an adjunctive treatment for MDD inpatient experiencing inadequate response to ongoing background antidepressant treatment. The primary endpoint of both studies is the same. The change in the Madras total score from baseline to day 28 for REL 1017 is compared to placebo. Also, during the third quarter, we announced efficacy and safety results from the open-label one-year safety study for REL 1017, study 310 or 310. These long-term safety exposure data are required for the purpose of the NDA filing. More specifically, in September, we shared efficacy results for the 204 de novo or new-to-treatment patients and safety results for all 627 study subjects. Study REL 1017-310310 was a long-term open-label, non-comparative open-label, registration of phase three trial design to evaluate the efficacy and safety of REL 1017 administered one daily in patient with MDD for up to one year. I will now reiterate some of the previously communicated results in the de novo patients. Rapid and sustained improvement in MADBRA score were observed in with REL1017 in the de novo patient and the entire study population. As the de novo patient reflects the more reliable picture of the real-world condition, I will highlight the de novo patient results. The mean Madras total score was 33.8 at baseline. Treatment with REL1017 in this patient resulted in mean improvement from baseline in the Madras total score of 16.8 points at month one, 19.9 points at month three and six, and 22.5 points at month 12. High rates of clinical response, both rapid and sustained, were seen in de novo patients. When treated with REL 1017 in the Madras total score at day seven, 26.6% of the de novo patients achieved the clinical response. That is defined as the greater than or equal to a 50% improvement in the MADRA score, which increased to 51% by month one and 77.2% by month 12. Virtual absence of depressing symptoms or clinical remission was achieved by 12.1% of the de novo patients at day 7, which increased to 30.1% at month 1, and then again 54.4% at month 12. Clinical remission is defined as the Madras total score of less than or equal to 10. Patients treated daily with REL1017 for up to one year experienced a rapid, clinically meaningful, and sustained improvement in depressive symptoms and associated functional impairment. Importantly, the overall madras change and response and remission results in study REL1017-310 for the de novo patient and the full analysis that were consistent in both groups. For all the REL1017-310 subjects, REL1017 was well-tolerated with long-term dosing, showing low rates of adverse events and discontinuation due to adverse events. No new safety signals were detected. Moving now to our promising preclinical novel modified release psilocybin program. At next week or this weekend, AASLD meeting, the new data will be presented in a poster presentation. The data demonstrate the beneficial effect of non-psychedelic low-dose psilocybin on multiple metabolic parameters in a rodent model of metabolic dysfunction-associated steatotic liver disease, or MASLD. As a reminder, they are not currently approved drugs for MAL-SMD. And these initial preclinical results support the therapeutic potential of non-psychedelic low-dose psilocybin. Based on this data, non-psychedelic low-dose psilocybin could improve lipid and glucose levels with potential for fewer side effects over other investigative treatment approaches, such as the GLP-1. We intend to initiate a single ascending dose phase one trial in obese patients with steatotic liver disease in early 2024 to define the pharmacokinetic safety and tolerability profile of our modified release psilocybin formulation in this population, followed by a phase two A trial in the same patient population to establish clinical approval concept.
spk05: Moving on, Magid will provide a detailed review of our financials.
spk07: But I would like to emphasize that RealMada remains sufficiently funded to fully execute our plans to reach data readouts for both REL 1017 Phase III trials, REL ANSU, and RELI. I will now turn the call over to Magid to review our second quarter financial results. Magid.
spk01: Thank you, Sergio. Today we issued a press release announcing our business and financial results for the three and nine months ended September 30, 2023, which I will now review. For the third quarter ended September 30, 2023, total research and development expense was approximately $10.5 million, as compared to $30.5 million for the comparable period of 2022, a decrease of approximately $20 million. The decrease was primarily associated with the completion of Reliance 1, that's Study 301, and Reliance 3, Study 303, in late 2022. The non-cash charge related stock-based compensation totaled $1.7 million in the most recently completed third quarter. Total general and administrative expense for the third quarter ended September 30, 2023, was approximately $12.2 million. as compared to $8.2 million for the comparable period of 2022, an increase of approximately $4 million. The increase was primarily driven by an increase in stock-based compensation. This non-cash charge totaled $9.6 million in the most recently completed third quarter. Net cash used in operating activities for the three months ended September 30, 2023, totaled $11.6 million compared to $26.9 million for the three months ended September 30, 2022. For the third quarter ended September 30, 2023, the net loss was $22 million or 73 cents per basic and diluted chair compared with a net loss of $39.4 million or $1.31 per basic and diluted chair in the comparable period of 2022. Turning to the results for the nine months ended September 30, 2023, total research and development expense was approximately $40.1 million as compared to $86.5 million for the comparable period of 2022, a decrease of approximately $46.4 million. Again, the decrease was primarily associated with the completion of Reliance 1, Study 301, and Reliance 3, Study 303 in late 2022. The non-cash charge related to stock-based compensation totaled $5.5 million in the most recently completed nine-month period. For the nine months ended September 30, 2023, total general and administrative expense was approximately $36.8 million as compared to $36.1 million for the comparable period of 2022, an increase of approximately $700,000. The increase was primarily driven by an increase in stock-based compensation. This non-cash charge totaled $28.5 million in the most recently completed nine-month period. Net cash used in operating activities for the nine months ended September 30, 2023, totaled $41.4 million, compared to $67.9 million for the nine months ended September 30, 2022. For the nine months ended September 30, 2023, net loss was approximately $73.6 million or $2.45 per basic and diluted share compared to a net loss of $119.1 million or $4.04 per basic and diluted share in the comparable period of 2022. As of September 30, 2023, we had cash, cash equivalents, and short-term investments of approximately $106.3 million compared to approximately $148.3 million as of December 31, 2022. Again, cash used in operations for the third quarter was $11.6 million. Based on our clinical development plan, our current cash position provides us with ample runway through the end of 2024. Of note, this time period, as Sergio mentioned, includes data readouts from both Phase 3 trials, Reliance 2, that's Study 302, and Relight, that's Study 304, as well as the initiation of our planned Phase 1 trial for our modified release, psilocybin formulation. And I'll turn the call over now to the operator.
spk03: Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star, followed by one on your touchtone phone. You will hear a three-tone prompt acknowledging your request, and your questions will be polled in the order they are received. Should you wish to decline from the polling process, please press star, followed by two. If you are using a speakerphone, please lift the handset before pressing any keys. One moment, please, for your first question. Your first question comes from Mark Goodman, Leerink Partners. Mark, please go ahead.
spk08: Hi, good afternoon. This is Basma for MARC. Congratulations on the quarter. I have a question regarding the Alliance OLS study. Would this study conduct at the same sites as Reliance 1 and Reliance 3? And I also have a question about the Reliance 1 and Reliance 3, regarding the patient characteristics. Can you remind us again about the average age of the participants after you looked at the data, after you unblinded the data? And have you noticed any correlation between the inaccurate diagnosis of MGT and the age of the participants? Thank you.
spk05: Great.
spk07: Well, thanks for the question. I do believe that Cedric, our chief medical officer, is the most appropriate to address them. Cedric.
spk06: Yes, thanks, Sergio, and thanks for the question. So, yes, as is very common when you have controlled trials, you also have an open-label extension trial that's offered. So, therefore, Yes, the sites that were part of Reliance 1 and Reliance 3 also had the opportunity to be part of the open label study and contribute subjects to that long-term study. Remember, there was a question then about the average age, and these studies are run in adults 18 to 65 years of age, and of course you know that major depressive disorder is represented at a two-to-one ratio in females than males. We haven't looked at age breakdown. There's lots of interesting analysis that we will do, but I can't comment on a correlation or outcomes by age. But the average age was probably in the area of the 40s or 50s. Got it.
spk08: Thank you so much.
spk03: Thank you. Thank you. Your next question comes from Yui Ir Mizuho. Yui, please go ahead.
spk04: Hi, this is Charles. I'm for OI. I guess I kind of had a follow-up question to that. If there was any other read-throughs from the open-label de novo patients to the Phase III studies, and then also if you saw a difference between the adjunctive and the monotherapy patients from that open-label.
spk07: Thanks, Charles. Sergio here. Let me try to give you a little bit more like top-down, and then Cedric can go more in detail. And so learning, look, the long-term safety study is 12 months, and we look at the Madras improvement data, and the conclusions are simple but significant and material because these represent real-world experiences. So what we have seen is that there is a rapid effect and there is a clear effect. And, you know, the 70 plus percent of the patient responded after 12 months. And the sustained, so there is no loss of efficacy over time. And the safety has confirmed that the drug is extremely safely and well tolerated. So these are really the key learning in a real-world experience. The answer or the question to there is a difference in adjunctive and monotherapy, in the 12-month study, it's not really very significant to make a difference. It's a mix, so it would be unfair to separate monotherapy from adjunctive because we don't know right, in 12 months where people do that, somebody take medication, they stop them, somebody doesn't take them. So it would not be a reliable information. Though, I mean, we look at the novel and the overall population that come from the two phase three studies, it's over 500, 600 patients. There is really no difference that would be remarkable. There is no, let's put it in this way, there is no subset of patients that that would spike either way, that the drug didn't work well or they work extremely well. It's pretty consistent, and that makes us comfortable because it's a real-world experience. Cedric, do you want to add anything to my remarks?
spk06: I think you said it all. Just to confirm what you said, that there's this consistent improvement trajectory with rapid onset. The de novo is the ideal group to look at when you're looking at efficacy in the open label. because that study isn't as well controlled as our placebo-controlled trials on who gets in. So there's a lot of subjects and a lot of common medications that they're on. So it's quite a mixed bag, but one thing is consistently observed is that whatever the treatment setting, patients got better quickly. with really high response and remission rates in the open label and consistent trajectory as we've also seen in the control trials.
spk04: Thanks so much. Thanks for taking my question.
spk03: Thanks, Charles. Thank you. Your next question comes from Andrew Tsai, Jefferies. Andrew, please go ahead.
spk00: Hi. Thanks so much. This is Dina on for Andrew. We just had a couple of quick questions. What are each of your two Phase III studies, you know, sort of power to show in terms of major separation versus placebo? And a question for Cedric, you know, operationally speaking, how can you say with high confidence the study integrity for the two Phase III studies in 10-17 are similar to how Axiom successful studies were run? Are you seeing a lot of similarities between those two programs? And if you could just elaborate on that. Thank you.
spk07: Yeah, thanks, Adina. Maybe Cedric should answer that. Maybe I just would like to try to answer your last question, right, on the comparison with Axone. And Cedric runs both the trials, running our trial and run Axone trial, but these are very, very, very different drugs. So I don't know how much would be reliable to compare the two programs. And Cedric, do you want to try to answer it?
spk06: Sure. Yeah, no, I think that anybody who's in the drug development space, particularly in major depressive disorder, very much tries to run as high quality a program as possible. And that really comes down to three things, the protocol, the site selection, and subject selection. It doesn't matter which sponsor you work for. You want to have a very tight, efficient protocol that aims to reduce placebo response. And then you want to work with the best sites that are conducting MDD trials. And of course, those of us who work in clinical research for depression know that there are always the same sites known to the sponsors. You would expect that there would be knowledge and familiarity because these sites are the best in major depressive disorder. And then you just have to very carefully have an eligibility process that makes sure that you're avoiding, that you're getting the right patient with confirmed diagnosis of MDD and you're avoiding professional patients. And you're doing everything from a subject selection process as well that might minimize recruiting or enrolling patients or subjects, I should say, who may be prone to having a high placebo response. So you do that across the program. And I have to say that I'm very pleased with how rigorous our eligibility process is in letting subjects into the trial. And the question on the statistical powering, We haven't actually revealed that yet. So, you know, I mean, it would be reasonable to, if you take the phase two data and if you were to consider 301 or 303 where placebo was controlled to about 10 or 11 points improvement on the madras, you could probably figure out how we're powering it because we are targeting approximately 300 subjects, as Sergio mentioned at the beginning. So I hope that helps a little bit with an answer to your question.
spk07: If I can add just one quick point. According to the KOLs and the history literature, a difference in MAGRA score versus placebos, two, two and a half points, is considered clinically meaningful and enough for approval. So you may imagine that we will the statistical plan according to these parameters. So the statistic will be set up to detect a madras difference from placebo that is clinically meaningful and good enough for approval.
spk05: I hope I answered appropriately your question.
spk03: Thank you. Ladies and gentlemen, as a reminder, should you have a question, please press star 1 on your touchtone phone. Your next question comes from Yatin Suneha Guggenheim. Yatin, please go ahead.
spk09: Hi, this is Delma for Yatin, and thanks for taking my question. So I have a few questions on the psilocybin program. I just wanted to ask you if you have already filed the IND for the phase 1 trial, and how many doses are you planning to use there? Are there any of these sources expected to trigger psychedelic resistance? Thank you.
spk07: Yeah, sorry. I answered the first, Sergio, yeah. The first part of the question, then if you don't mind to repeat the second one because I couldn't hear you very well. So, no, we haven't filed the IND. We are on the process to prepare the IND, and I do believe we'll be filed relatively soon, but we are planning to start the phase one single dose, the shending in Q1 next year. So let's say two, three months from now. And can you please repeat the second part?
spk09: Yeah, sure. I was just asking if you have those, how many doses you are planning to test there? And if any of these doses is expected to trigger a psychedelic experience?
spk07: How many doses? No, we haven't finalized it yet. the exact dose regimen we'll discuss in the IND. But what I can share with you is what will be the dose limiting toxicity. And it is not real toxicity because we know that psilocybin is well tolerated from the literature and the history and from other programs that are ongoing that are using 20, 25 milligrams in a single dose. And we will use one-tenth of that. So we'd It's a fair assumption that the dose we'll be using will not be toxic or not well tolerated in general term. But the dose limiting toxicity we are trying to determine is when you start to have psychopimetic, psychological, psychotic or psychosymptoms, I put it in this way, when you start to feel that the drug is affecting your psych. So we are developing... a low-dose extended release that is non-psychedelic. So the dose limit in toxicity will be the psychedelic effect. We don't know exactly what the dose is, but we assume that it will be below three, four milligrams daily.
spk09: Okay. Thank you.
spk05: Thank you. There are no further questions at this time. Please proceed. Well, thank you.
spk07: Look, in summary, we remain confident that we do have an approvable drug in REL 1017, and we are excited about the potential of the novel psilocybin and derivative programs. We look forward to reporting the progress with our pipeline in the months ahead, and I do remain grateful to the Realmada team for their continued hard work and dedication to executing on our mission. 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, and we'll reconnect soon.
spk03: Thank you. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.
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