Relmada Therapeutics on Wednesday said its experimental drug for major depressive disorder failed a second late-stage trial. But the Florida biotechnology is still holding out hope that a third, ongoing study could produce a different result.
According to Relmada, a four-week course of its drug administered alongside standard treatment didn’t lead to a statistically significant improvement versus a placebo on a ratings scale measuring symptoms of depression. After 28 days, the scores of patients treated with Relmada’s drug declined by an average of 15.1 points. Placebo recipients’ scores fell by a mean of 12.9 points.
The setback marks the second study failure for Relmada’s drug since October. In the first trial, its treatment, known as REL-1017, was tested as a monotherapy. The latest test evaluated Relmada’s treatment in tandem with typical antidepressants in patients who haven’t responded to one to three other therapies.
Relmada, for its part, believes both studies missed their mark because of a higher-than-expected placebo response, a common occurrence in psychiatric drug trials. In October, for instance, the company claimed to find “paradoxical results” at certain study sites in which placebo recipients “dramatically outperformed” its drug. On Wednesday, the company argued that in its latest trial, a “limited number of high enrolling sites” had an “unplausible placebo response.”
When excluding those sites, REL-1017 had a statistically significant benefit, but those findings come from a post hoc analysis and don’t change the trial’s outcome.
Despite the setbacks, Relmada is still pushing forward. For example, it’s still running a third Phase 3 trial evaluating REL-1017 as an adjunctive treatment and is now making “several protocol and operational changes” to the study. Results are expected in 2023, and Relmada plans to run other trials next year as well. The company had $180 million in cash at the end of the third quarter, which management believes can keep Relmada operating for another two years, according to a note from SVB Securities analyst Marc Goodman.
“With two failed pivotal studies, it would be easy to say that this drug doesn't work; however, failed studies are very normal with MDD trials, and we still believe this drug has activity,” Goodman, of SVB wrote. “We admit this will take a lot of patience.”
Most investors aren’t waiting around. Shares that had already lost a majority of their value since October fell by another 50%, to under $2 apiece, in early trading Thursday. The stock is now trading well below the worth of its cash reserves.
REL-1017 blocks the activity of a neurotransmitter called NMDA that controls mood and has long been seen as a potential target for fast-acting depression medicines. That hypothesis has led to two drug approvals in recent years, first of Johnson & Johnson’s nasal spray Spravato in 2019 and then, in August, Axsome Therapeutics’ oral treatment Auvelity.