VistaGen Therapeutics Q4 2024 Earnings Report

VistaGen Therapeutics EPS Results

• Actual EPS: -$0.25
• Consensus EPS: -$0.34
• Beat/Miss: Beat by +$0.09
• One Year Ago EPS: N/A

VistaGen Therapeutics Revenue Results

• Actual Revenue: $0.20 million
• Expected Revenue: $0.41 million
• Beat/Miss: Missed by -$210.00 thousand
• YoY Revenue Growth: N/A

VistaGen Therapeutics Announcement Details

• Quarter: Q4 2024
• Date: 6/11/2024
• Time: N/A
• Conference Call Date: Tuesday, June 11, 2024
• Conference Call Time: 5:00PM ET

VistaGen Therapeutics (NASDAQ:VTGN) (NASDAQ:VTGN) is a clinical-stage biopharmaceutical company dedicated to the discovery and development of next-generation medicines for central nervous system disorders. Incorporated in Delaware in 1998 and headquartered in South San Francisco, California, VistaGen applies advanced human pluripotent stem cell technologies to accelerate drug candidate validation and optimization. The company’s core focus is on addressing unmet medical needs in major depressive disorder, neuropathic pain and dermatological conditions.

The company’s lead candidate, AV-101, is an oral prodrug designed to modulate glutamatergic neurotransmission via the N-methyl-D-aspartate (NMDA) receptor pathway, with clinical programs targeting major depressive disorder and neuropathic pain. VistaGen also develops PH-10, a topical neuroactive small molecule in clinical development for psoriasis and atopic dermatitis. To broaden its development reach, VistaGen has entered strategic partnerships, including a licensing agreement with Yuhan Corporation for AV-101 in South Korea, and continues to advance its clinical and regulatory strategy primarily in North America and Asia.

VistaGen’s proprietary Human Clinical Drug Rescue and ReRationalization platform employs patient-derived pluripotent stem cell–derived neural and cardiac cells to predict clinical efficacy and safety, reduce late-stage development risk and complement traditional preclinical models. This platform supports both in-house pipeline programs and collaborative research initiatives. Leading the company is President and Chief Executive Officer Shawn K. Singh, who has overseen VistaGen’s research and corporate development efforts since joining in 2014 and remains committed to translating innovative science into new therapeutic options for underserved patient populations.

VistaGen Therapeutics Q4 2024 Earnings Call Transcript

Key Takeaways

• Vistagen reported positive results from its PALISADE II Phase III study of intranasal fastodionol for acute treatment of social anxiety disorder, marking the first positive Phase III trial in this indication.
• The company has launched its PALISADE III and plans PALISADE IV Phase III trials, aiming for top-line data in mid-2025 and late-2025 respectively, with enhanced protocols to optimize enrollment, surveillance, and reduce variability.
• A small placebo-controlled repeat-dose study is planned to assess the effects of a second fastodionol dose 10 minutes after the first during public speaking challenges, with readout expected near the end of calendar 2025 to inform labeling.
• Vistagen’s broader neuroscience pipeline includes itrulovone for major depressive disorder (moving toward Phase 2b planning) and PH80 for menopausal hot flashes and PMDD, both leveraging rapid-onset, nonsystemic intranasal delivery and supported by positive Phase 2a data or ongoing IND-enabling studies.
• For fiscal year 2024, R&D expenses fell to $20 million from $44.4 million driven by trial timing, general & administrative costs were $14.1 million, net loss was $29.4 million, and cash and equivalents stood at $119.2 million as of March 31, 2024.

Presentation

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Greetings and welcome to the Vistagen Therapeutics fiscal year-end 2024 corporate update conference call. At this time, all participants are in a listen-only mode. The question-and-answer session will follow the formal presentation.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mark McPartland, Senior Vice President of Investor Relations.

[Mark A. McPartland, SVP of Investor Relations at Vistagen Therapeutics]

Thank you, Joe. Good afternoon, everyone, and welcome to Vistagen's fiscal year-end 2024 corporate update conference call and webcast. This afternoon, we filed our annual report with the Securities and Exchange Commission, or SEC, on SEC Form 10-K for our fiscal year ended March 31st, 2024, and issued a press release providing an overview of our progress during our fiscal year 2024.

[Mark A. McPartland, SVP of Investor Relations at Vistagen Therapeutics]

We encourage you to review the press release and our 10-K, both of which can be found in the investor section of our website. During today's call, we'll make forward-looking statements regarding our business based on our current expectations and information. These forward-looking statements speak only as of today and, except as required by law, we do not assume any duty to update in the future any forward-looking statements made today.

[Mark A. McPartland, SVP of Investor Relations at Vistagen Therapeutics]

Of course, forward-looking statements involve risks and uncertainties, and our actual results could differ materially from those anticipated by any forward-looking statements we make today.

[Mark A. McPartland, SVP of Investor Relations at Vistagen Therapeutics]

Additional information concerning risks and factors that could affect our business and the financial results is included in our fiscal year-end 2024 Form 10-K filed earlier today with the SEC and in the filings that we'll make with the SEC from time to time in the future, all of which are available in the investor section of our website and/or on the SEC's website.

[Mark A. McPartland, SVP of Investor Relations at Vistagen Therapeutics]

With the formalities out of the way, we offer a warm welcome to all of our stockholders, sell-side analysts, and others interested in Vistagen. I'm joined on our call today by Shawn Singh, our Chief Executive Officer; Cindy Anderson, our Chief Financial Officer; and Josh Prince, our Chief Operating Officer.

[Mark A. McPartland, SVP of Investor Relations at Vistagen Therapeutics]

Shawn will provide an update on our lead programs in our diversified neuroscience pipeline. After the conclusion of the prepared remarks, there will be a brief opportunity for questions from the sell-side analysts. As a reminder, the call is being webcast and will be available for replay after completion. The replay link can also be found in the investor section of our website. With that, I'd like to turn the call over to our Chief Executive Officer, Shawn Singh.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Thank you, Mark. Sorry about that, everyone. Good afternoon, and thank you for joining our call. Vistagen's fiscal 2024 was filled with a series of remarkable accomplishments, most notably with the positive results from our PALISADE-2 U.S. Phase III study of fasedienol for the acute treatment of social anxiety disorder.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Vistagen became the first company to achieve a positive Phase III study with a drug candidate for the acute treatment of SAD. In addition, with the potential to complement PALISADE-2, we recently launched our PALISADE-3 Phase III trial, marking that as the next major step forward in our registration-directed PALISADE Phase III program for fasedienol and SAD.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

These significant achievements and progress across our diversified pipeline of novel neuroactive pherine candidates reflect our commitment to pioneering neuroscience that's anchored in a deep understanding of nose-to-brain neurocircuitry, focused on developing differentiated drug candidates with potential to set new standards of care for underserved patients affected by high-prevalence neuroscience disorders.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

As a brief reminder to some and as an introduction to others, our diverse clinical stage neuroscience pipeline features a new class of neuroactive intranasal product candidates known as pherines.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Exclusively designed as nasal sprays, our pherine pipeline leverages an innovative approach to treating psychiatric and other neuroscience disorders by using the nose as a portal for the administration of novel, rapid-onset, neurocircuitry-focused drug candidates that do not require systemic absorption or binding to neurons in the brain to achieve desired therapeutic effects.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Administered in microgram-level doses within milliseconds, each member of our new class of pherines activates peripheral chemosensory neurons in the nasal cavity, influencing fundamental neurocircuitry in both the olfactory system and the brain.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

With unique proposed mechanisms of action, or MOAs, our non-systemic neurocircuitry-focused pherines have demonstrated favorable and differentiated safety profiles in all clinical studies completed to date.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Our aim is to develop and to commercialize a diversified pipeline of neuroactive pherines for multiple high-prevalence CNS disorders such as social anxiety disorder, major depressive disorder, and menopausal hot flashes, indications with limited differentiated FDA-approved treatment options and inadequate or even non-existent current standards of care.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

For example, social anxiety disorder, which is a neuropsychiatric disorder that's marked by profound fear and anxiety of social and performance situations in everyday life, is often triggered by social media and team orientation in the workplace or in academic settings.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

The disorder that affects more than 30 million U.S. adults, yet despite the high and seemingly ever-growing prevalence of SAD, there is still no FDA-approved acute treatment to help individuals rapidly and safely manage their anxiety symptoms when faced with social and performance stressors in their everyday life, especially when they are faced with multiple different anxiety-provoking stressors during any single day and at different times in that day.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Our Phase III program for fasedienol intends to help close that treatment gap for the millions of underserved individuals that are affected by SAD without an adequate option for a rapid, flexible, and patient-controlled treatment.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Building on our success during fiscal 2024, our registration-directed PALISADE Phase III program for fasedienol for the acute treatment of SAD is progressing on track, including enrollment in our recently launched PALISADE-3 trial, which is on track for top-line data mid-year in calendar 2025, as well as preparations for our upcoming PALISADE-4 trial that we expect to initiate in the second half of this year and complete before the end of calendar 2025.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Both Phase III trials are designed with the potential to replicate our successful PALISADE-2 Phase III trial. While the public speaking challenge design of PALISADE-2 and the use of the Subjective Units of Distress Scale, or SUDS, is the primary efficacy endpoint and the studies are unchanged.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

We've built some notable enhancements into PALISADE-3 and PALISADE-4 and made some operational changes we believe will help optimize quality enrollment, enhance surveillance, and control potential variability, as well as drive rigorous protocol adherence during execution of PALISADE-3 and PALISADE-4, all against the backdrop of what is now a far more favorable and stable clinical research environment than at any time during the pandemic.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

During the second half of 2024, we're also planning to initiate a small placebo-controlled repeat dose study in alignment with our discussions with the FDA to evaluate the effects of a second dose of fasedienol administered 10 minutes after the first dose prior to a public speaking challenge.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Similar to PALISADE-4, we anticipate completing this study in the second half of calendar 2025 with a top-line readout near the end of calendar 2025. We believe success in either PALISADE-3 or PALISADE-4, combined with the positive results from PALISADE-2 and additional open-label safety data from all fasedienol clinical trials to be completed next year, may provide substantial evidence of fasedienol's effectiveness and safety to support submission of a potential U.S. new drug application for the acute treatment of SAD during the first half of 2026, which, if approved, could be the first approval of its kind.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

As a reminder, the FDA has granted Fast Track designation for our development of fasedienol for the acute treatment of SAD. We are also actively exploring the therapeutic potential of our pherine itruvone, another non-systemic pherine candidate with the potential to be a new and fundamentally differentiated therapy for major depressive disorder, or MDD.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Preparations and planning for U.S. Phase IIB development of itruvone and MDD are ongoing. Our mission in this large and increasingly prevalent neuropsychiatry market is to transform the standard of care, expediting the time frame in which individuals may find relief of their MDD symptoms with a new, rapid-onset product candidate with a differentiated safety profile that is not associated with unwanted side effects and safety concerns such as sexual side effects, weight gain, or abuse liability.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

We also see significant medical and commercial potential in PH80, our rapid-onset, non-systemic, hormone-free pherine nasal spray candidate for women's health indications. During fiscal 2024, we announced positive data from two previously unreported placebo-controlled exploratory phase IIA studies conducted outside the U.S. PH80 demonstrated statistically significant results both as a treatment for vasomotor symptoms or hot flashes that are due to menopause and for the management of premenstrual dysphoric disorder, or PMDD.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

We are currently conducting U.S. IND-enabling non-clinical studies with the potential to facilitate further phase II clinical development of PH80 for menopausal hot flashes in the U.S., which is another high-prevalence indication affecting approximately 80% of women ages 45-65 with current treatment options that are not satisfactory or suitable for millions of those women worldwide.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

We're also pleased to enter into an exclusive negotiation agreement with Fuji Pharma, which is a leading women's health-focused company in Japan during fiscal 2024, focused on negotiating exclusively for a potential license agreement with them for the development and commercialization of PH80 in Japan.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

On a corporate level, Vistagen received Mental Health America's prestigious Platinum Bell Seal Award during the first quarter of fiscal 2024 and again in the first quarter of the current fiscal year.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

We also received the esteemed Great Place to Work certification, with each of these awards reflecting our commitment to be a company that exceeds workplace practices and standards intended to promote and support mental health and the well-being of our employees while also playing a key role in promoting and advancing a broad societal shift toward destigmatizing mental illness.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

With that, I'll now turn the call over to our CFO, Cindy Anderson, to summarize some of the highlights from our fiscal 2024. Cindy?

[Cindy Anderson, CFO at Vistagen Therapeutics]

Thank you, Shawn. As Shawn mentioned, I'll highlight a few financial results from our fiscal year 2024. I also encourage everyone to review our report on Form 10-K filed with the SEC earlier this afternoon for additional details and disclosures. Research and development expenses were $20 million for the year ended March 31, 2024, as compared to $44.4 million for the year ended March 31, 2023.

[Cindy Anderson, CFO at Vistagen Therapeutics]

This decrease in R&D expenses was primarily due to a decrease in clinical and development expenses related to the timing of expenses incurred in our Phase III trials of fasedienol and SAD. General and administrative expenses were $14.1 million for the year ended March 31, 2024, as compared to $14.7 million for the year ended March 31, 2023. The decrease in G&A expenses was primarily due to a decrease in professional fees and stock-based compensation expense, offset by an increase in compensation expenses.

[Cindy Anderson, CFO at Vistagen Therapeutics]

Our net loss attributable to common stockholders was $29.4 million for the year ended March 31, 2024, compared to $59.2 million for the year ended March 31, 2023. As of March 31, 2024, we had cash and cash equivalents of $119.2 million. As a reminder, please refer to our annual report on Form 10-K that was filed today with the SEC for additional details and disclosures. I will now turn the call back over to Shawn.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Thank you, Cindy. So as we conclude our prepared remarks, I just want to underscore the hard work and the commitment, as well as the pride and the enthusiasm of our team around our potential to improve the patient lives who are focused on helping and to deliver value to our stockholders.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

With the commencement of our PALISADE-3 and the pending launch of our PALISADE-4 Phase III trials for fasedienol targeting the acute treatment of SAD, a market with increasing prevalence now topping 30 million Americans, we are systematically executing our registration-directed program with the potential to achieve the first FDA approval for that indication.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

We have great confidence in our team's expertise in executing our PALISADE-3, PALISADE Phase III program, and all the programs across our neuroscience pipeline. On behalf of the entire team at Vistagen, I'd like to thank you for your ongoing interest and for your support.

[Mark A. McPartland, SVP of Investor Relations at Vistagen Therapeutics]

Thank you, Shawn. Operator, we would now like to open up the call for questions from the sell-side analysts participating on the call today.

[Operator]

Thank you. Ladies and gentlemen, if you'd like to ask a question, please press star one on your telephone keypad, and a confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue.

[Operator]

For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question comes from the line of Andrew Tsai with Jefferies. Please proceed.

[Matthew Larson, EVP and CFO at Jefferies]

Hey, good afternoon and congrats on the progress. This is Matt on for Andrew, and I just had a couple of questions, if you don't mind. In PALISADE-3, how many patients have you enrolled so far, and is the enrollment cadence looking stronger or slower than the first couple of studies? Then also, if you don't mind commenting on the screen failure rate and how that compares to the prior studies as well. Thank you.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

I'm sorry, I didn't catch your name.

[Matthew Larson, EVP and CFO at Jefferies]

Matt, thank you.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Oh, hey, Matt. So we haven't given any guidance on enrollment at all, on specifics of enrollments and screen fail rates and the like, but what I can tell you is what I emphasized during the prepared remarks, which is we're very happy with the way that PALISADE-3 has kicked off.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

We've been able to build in some really important efficiencies not only throughout the execution of the study, but upfront even between lead generation and actual enrollment through Visit 1 and the screening. We've been able to achieve a lot of the things that reflect and leverage the lessons learned through the course of the prior execution of studies of this particular design leading all the way back to Phase II time.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

I think our team is extremely well-positioned to continue this study on track, and the same be the case for PALISADE-4 with the ability to achieve the readouts right around the time that we've guided, which would be mid-2025 and then near the end of 2025 for PALISADE-4.

[Matthew Larson, EVP and CFO at Jefferies]

Okay, got it. Thank you.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Josh, anything to add to that? Josh?

[Joshua Prince, COO at Vistagen Therapeutics]

Yes, hello, Shawn. Yes, thanks. I would just say that we are pleased with the startup of PALISADE-3, that it's meeting our expectations in terms of recruitment rates, in terms of screen failure rates, those types of things. So at this point, we're very pleased with our progress.

[Matthew Larson, EVP and CFO at Jefferies]

Thanks, Josh.

[Operator]

The next question comes from the line of Paul Matteis with Stifel. Please proceed.

[Company Representative at Stifel]

Hi, there. This is Julian on for Paul. Thanks so much for taking our question. You described a couple of notable enhancements that you made, things like operational changes, enhanced surveillance, etc. Do you mind just providing a little bit more color on what exactly you're doing and why that gives you greater confidence as you continue enrolling PALISADE-3 and soon PALISADE-4?

[Company Representative at Stifel]

Then just really quickly, one quick question. On the repeat dose study, do you mind telling us just what you're looking to achieve here, and is this more about building the safety database, or is this more about replicating efficacy with a multi-dose paradigm? Thank you.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Great. Hey, thanks, Julian. Appreciate the questions. So just to be clear right up front, the public speaking challenge design will remain the same across PALISADE-2, 3, and 4, so as will the SUDS as the primary efficacy endpoint. So no changes there. Those will continue again to remain consistent throughout the development of fasedienol for the acute treatment of SAD, and that's been the case all the way back to Phase II.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

So the refinements that we made to PALISADE-3 and 4 really are based, again, on experience that we have, very unique and extensive experience scaling up to a large Phase III study, that come from our observations of the conduct of the PALISADE-3 program from, again, the early through the late stages of the pandemic in particular.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

So the enhancements to PALISADE-3 and PALISADE-4 apply primarily to ensuring that we've got optimal subjects in the study, real extensive, precise, and universally applied screening, inclusion and exclusion criteria, and that the public speaking challenge protocols administered properly and consistently with limited variability.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

So, for example, one of the exclusion criteria that's been added is limiting high-frequency smoking or vaping, THC use, signs of COVID, or any recent nasal swabs, all of which could have some sort of an impact possibly on receptors and impact a single-dose public speaking challenge.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Josh, maybe talk about some of the other things that you and the team have been seeing some really significant benefits on as we've even pre-startup and now as we've gotten into the execution of PALISADE-3.

[Joshua Prince, COO at Vistagen Therapeutics]

Yeah, absolutely. I think two of the key things you touched on, Shawn, are our experience of going through PALISADE-1 and PALISADE-2, but then also being able to operate in a pandemic-free environment as we got PALISADE-3 up and running and as we look forward to getting PALISADE-4 up and running.

[Joshua Prince, COO at Vistagen Therapeutics]

It's just allowed us to really drive consistent execution across sites to reduce the potential variability and it's really around changing our approach to both study monitoring and our staffing model, right?

[Joshua Prince, COO at Vistagen Therapeutics]

So it gives us rigorous training of sites and then oversight of study conduct. So if you think about where we are with PALISADE-3 compared to PALISADE-1 or 2, we had an in-person investigator meeting for PALISADE-3. So we had that face-to-face in-person training of PIs, raters, study coordinators, which we couldn't do in 1 and 2.

[Joshua Prince, COO at Vistagen Therapeutics]

Then as we've gotten sites up and running, kind of that startup process, we've already had more in-person site visits in PALISADE-3 than we did in either PALISADE-1 or PALISADE-2 because of the restrictions of the pandemic. So that new site-facing staffing model is just giving us a lot more oversight and increased level of site communication to make sure that the studies are going the way that we want them to.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

I also add that we've eliminated mask-wearing in these PALISADE-3 and 4 by either the subject or the public speaking audience. Also the drug dose will be administered by the healthcare provider just to ensure, again, proper dosing for the study.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

So a lot of little small things as well as some significant changes all intended to really enhance and optimize surveillance, control variability, the things that actually make a difference on outcome, but those are some significant mitigators, we think, to some of the risks that are typically associated when you're scaling up to a multiple-center study.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Then as to the repeat dose study, I'll let Josh speak to that in a minute as well. But again, we're in line with what the FDA has been discussing with us for a while on that one. While there could be some safety benefits from the study, we also think it also could have some benefits on labeling. So Josh, why don't you just amplify a little more on what we've been thinking on the repeat dose study?

[Joshua Prince, COO at Vistagen Therapeutics]

Yeah, absolutely. It's essentially the same design as PALISADE-3 and PALISADE-4, just with the addition of an additional dose 10 minutes after the first, and then the subject moves into the public speaking challenge.

[Joshua Prince, COO at Vistagen Therapeutics]

The reason we're doing the study is because the FDA specifically asked and said, "You know what? In the real world, a patient might still feel nervous after a first dose and want to take another dose. So we'd like you to kind of see what happens in that instance."

[Joshua Prince, COO at Vistagen Therapeutics]

So that's why we're doing that, really for the purpose of informing the label for informing physicians on how they should advise patients and the other piece to that is we will have an open label extension or we plan on for that study. So that'll let us kind of see, again, in the real world, what happens if patients are able to use the product again within 10 minutes and whether or not they even do.

[Joshua Prince, COO at Vistagen Therapeutics]

So again, it informs the label and informs physicians on how to advise patients. Then finally, just to clarify, it's three arms. So it's placebo followed by a placebo, fasted INR dose followed by placebo, and then fasted INR dose followed by fasted INR for the three arms.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

You need to remember these pherines, they activate the chemosensory neurons within milliseconds. There's also a limited capacity for the nose to accept the volume of spray. So we're actually not expecting much, any really safety-related concern associated with the multiple dosing.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

But it does, as Josh noted, it has the potential to help inform labeling and give some guidance to which we do think is certainly safe, which is if someone were to dose it more frequently than, say, every hour, which is the typical duration of effect of fasedienol that we've seen in prior studies.

[Company Representative at Stifel]

Excellent. Thank you for the details.

[Operator]

The next question will come from the line of Tim Lugo with William Blair. Please proceed.

[Tim Lugo, Group Head of Biotechnology Equity Research at William Blair]

Thank you for the question, and congratulations on all the progress for PALISADE-3. I guess my question relates to PALISADE-3. How many sites are up and enrolling patients and of those sites, and maybe the planned sites for PALISADE-3, how many of those sites also overlap with PALISADE-1 and PALISADE-2?

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Thanks, Tim. I appreciate the question. One of the good things about having the experience that we've got within the clinical research community is the ability to really assess sites that we think play at a varsity level and others that might not be quite there. The emphasis certainly for what we're putting together for both of these Phase III studies to try to replicate PALISADE-2 is what we hope and believe is a varsity squad.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Some of them do overlap from the prior studies. I think right now, what we publicized, Josh, I'm not sure if we got them up today, but it should be right around 10 sites up. It's on a good pace for PALISADE-3. Some of them will have been in one or two.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

But all of them, uniquely, as we've talked about, even if they have been before, we know there's always a benefit. We've seen it with the fact that this is the third time that this protocol, after a very long drought of really nothing in social anxiety disorder, let alone for the acute treatment, like we said we've never seen. There's a lot of good experience and understanding and really positive read-through that we've seen at a lot of the scientific conferences where we've presented PALISADE-2 data.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

There's a great level of awareness, even sites and PIs not involved in the program, about what we're doing, the MOA associated with this class of drugs and this one in particular, and how what we're seeing is really a fundamentally differentiated approach and a drug candidate for what's been a challenge for practitioners for a very long time.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Which is to have something that a patient can use flexibly, control the use of it, use it multiple times a day and even at different times of day for different stressors on a certain day, and then have the ability to not use it on days when they're not stressed and don't want any medication of any kind, even a super safe one, in their body.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

I think the benefit is the pool of potential sites and the sites that we actually expect to see in these two studies is not only expanded, but of a much higher quality than we've ever seen before at this point.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

A lot of that's due to our own work, but it's also due to the awareness of the need, and especially because there is no—not only is there not an approved acute treatment for SAD, but even the available therapies for use on an off-label basis just fall way short of what this population seems to need to be able to be unimpaired cognitively, not worry about abuse liability, and to be able to really control and fit a medication to their life and the circumstances in their life that debilitate them and create and generate significant opportunity costs.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

So I guess, Tim, the bottom line is we really expect to have universal varsity programs on both PALISADE-3 and PALISADE-4 and a lot of that has to do with the way that we manage these studies. It's not just a quick in-person investigators meeting, but it's kind of like painting the Golden Gate Bridge up by you.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

That is you start and you go through the sites, and you go back through the sites and back through the sites. We're also not seeing the type of attrition and staff turnover at sites and at CRO with CRO support that was the case often through the pandemic.

[Shawn K. Singh, CEO at Vistagen Therapeutics]

There's a normative sense now within the clinical research community, at least for our neuropsychiatric focus for this program, that we're just really excited that the enhancements to the protocol on top of a more stable environment is a really good combination.

[Tim Lugo, Group Head of Biotechnology Equity Research at William Blair]

Thank you for that. I guess one more question for the small placebo-controlled repeat dose study. You mentioned it's for labeling purposes. Will there be a SUDS score recorded prior to the repeat dose and then after the repeat dose, or is it more of a safety and tolerability type of study?

[Shawn K. Singh, CEO at Vistagen Therapeutics]

Josh?

[Joshua Prince, COO at Vistagen Therapeutics]

Yeah, there absolutely are SUDS scores collected, identical to the SUDS scores that are collected in PALISADE-3 and PALISADE-4. So there's kind of the pre-speech SUDS, and then once the speech starts, obviously, those SUDS are captured for the primary endpoint. So the actual endpoints will be identical to those in PALISADE-3 and 4.

[Tim Lugo, Group Head of Biotechnology Equity Research at William Blair]

Will a certain nonresponse after the first dose score kind of trigger that second dose, or do you just collect all the data and let people, if they feel like they need to redose, let them redose?

[Joshua Prince, COO at Vistagen Therapeutics]

So in the public speaking challenge portion of the study, there is, if you recall, in the study design, there's a 15-minute waiting period after the subject takes the dose. So that second dose is administered in that same period and we think that the activation with fasedienol is almost instantaneous, we think.

[Joshua Prince, COO at Vistagen Therapeutics]

But in terms of the clinical study, we wait 15 minutes before the subject engages in the public speaking challenge. So it's really during that waiting period where that second dose is administered. So then beyond that, the study is identical to PALISADE-3 and 4.

[Tim Lugo, Group Head of Biotechnology Equity Research at William Blair]

Oh, okay. So it's potentially two doses before the public speaking challenge, not one dose public speaking, then another dose.

[Joshua Prince, COO at Vistagen Therapeutics]

Correct.

[Tim Lugo, Group Head of Biotechnology Equity Research at William Blair]

Oh, okay. Thank you so much.

[Joshua Prince, COO at Vistagen Therapeutics]

Correct.

[Joshua Prince, COO at Vistagen Therapeutics]

Yep.

[Mark A. McPartland, SVP of Investor Relations at Vistagen Therapeutics]

Operator, I believe that's all the time we have for questions today. If there's any additional questions, please do not hesitate to contact us by email at ir@vistagen or via the contact section of our website.

[Mark A. McPartland, SVP of Investor Relations at Vistagen Therapeutics]

We also encourage you to register for email updates on our website to stay connected to the latest news from Vistagen. Again, thank you all for participating on our call today. We appreciate everyone's interest and support. We look forward to keeping you current on our continued progress. This concludes our call. Have a magnificent day.

[Operator]

This concludes today's conference. You may now disconnect your lines at this time. Enjoy the rest of your day.

Participants

Analysts

• Cindy Anderson, CFO at Vistagen Therapeutics
• Joshua Prince, COO at Vistagen Therapeutics
• Mark A. McPartland, SVP of Investor Relations at Vistagen Therapeutics
• Matthew Larson, EVP and CFO at Jefferies
• Shawn K. Singh, CEO at Vistagen Therapeutics
• Tim Lugo, Group Head of Biotechnology Equity Research at William Blair
• Company Representative at Stifel