Greetings, and welcome to the Vistagen Therapeutics Fiscal Year 2024 First Quarter Corporate Update Conference Call. [Operator Instructions] And as a reminder, this conference is being recorded, Thursday, August 10, 2023. I would now like to turn the conference over to Mark Flather, Vice President of Capital Markets. Please go ahead.

Thank you, Jennifer. Good afternoon, everyone, and welcome to Vistagen's first quarter fiscal year 2024 corporate update conference call and webcast. This afternoon, we issued a press release providing an overview of our progress this last quarter. We encourage you to review this, which can be found on the Investors section of the Vistagen website. Before starting today, we want to remind you that we may make forward-looking statements regarding our business based on our current expectations and information. The forward-looking statements speak only as of today, and except as required by law, we do not assume any duty to update the future - in the future any forward-looking statement made today. 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 may make today. Additional information concerning risks and factors that could affect our business and financial results is included in our fiscal year 2024 first quarter Form 10-Q for the period ending June 30, 2023, and in future filings that we'll make with the SEC from time to time, all of which will be - which are and will be available on our website and the SEC's website. With that taken care of, we'd like to thank and welcome all the stockholders, analysts and everyone taking an interest in Vistagen. I'm joined on the call today by Shawn Singh, our Chief Executive Officer; and Josh Prince, our Senior Vice President of Business Operations. Shawn will provide an overview of our progress, focusing specifically on the results from our positive Phase 3 PALISADE-2 trial evaluating the efficacy, safety and tolerability of fasedienol, PH94B nasal spray in adults with social anxiety disorder, or SAD, followed by a brief opportunity for questions from sell-side analysts. We want to remind you that this call is being webcast and will be available for replay after the call is completed. The replay link can be found in the Investors Events section on our website. I'd now like to turn the call over to our Chief Executive Officer, Shawn Singh, to update you on a recent inspiring news regarding the PALISADE-2 Phase 3 study results.

Thank you, Mark, and good afternoon, everyone, and thanks for joining our call. As I've said before, many times, our team has remained steadfast in our core mission, which is to radically improve the mental health and well-being of millions of individuals around the world who are suffering from a wide variety of anxiety, depression and other CNS disorders that severely disrupt their daily lives. And as we've recently announced, we've solidified a major cornerstone in that mission focused on improving the lives of the over 25 million individuals in America who are affected by social anxiety disorder or SAD. There's indeed an active and growing need for a new faster-acting option for treatment of SAD without abuse potential or the side effects and safety concerns that often are associated with the currently approved medicines. We remain focused on addressing this significant unmet health - mental health need for individuals across a broad range of demographics and in a diverse range of communities across the globe. We're committed to innovation of multiple differentiated treatments in alignment with our mission to shift the treatment paradigm for anxiety, depression and multiple other CNS disorders. So a lot's changed since our last conference call, and let's get right to the biggest news in our company's history. It's been a long time since a positive Phase 3 study has brought in new optimism for treatment of social anxiety disorder, and we are thrilled to be in a leadership position with the compelling top line results from our Phase 3 PALISADE-2 trial that were announced on Monday. These Phase 3 results highlight the potential for fasedienol with its innovative proposed mechanism of action to transform what's possible for millions of individuals living with SAD in the U.S. and millions more who are affected worldwide. In…

Thank you, Sean. Jennifer, we'd now like to open up the call for questions from the sell-side analysts participating on the call today.

[Operator Instructions] And our first question is from the line of Andrew Tsai from Jefferies. Please go ahead.

Hi everyone. Good afternoon. Thanks for taking my questions. And I wanted to offer a big congratulations on the recent data. So now that you have PALISADE-2 on hand, how confident are you this study could be one of two traditionally supportive placebo-controlled pivotal Phase 3 studies for a filing? And then second to that is do you think you'll meet with the FDA? And if so, when could we get a resolution on the next steps in the NDA package? Thanks.

Well, thanks, Andrew. I appreciate the question, and thanks for the congratulations. It's certainly enabling. Whether the FDA accepts the trial is pivotal. That's always to be determined downstream by the FDA, but there's no doubt in our mind, we didn't change anything. It's - the only difference, as I noted, was the number of subjects, so there's no type 1 error. There's no protocol amendment. There was no deviation at all from the original plan other than the number of subjects. So having a highly stat sig result with the profound safety profile that we've seen now in hundreds and hundreds of patients that have been exposed to fasedienol, you already - remember, we had FDA feedback regarding abuse liability and a favorable amount of feedback from the FDA. And that was even before our open label study delivered the results we reported. So I mean I like where we stand. Having something in this disorder with a validated end point with highly stat sig data and clean safety data, I really like our chances. So it's certainly going to be a key pillar in our NDA submission downstream should we get to that point with additional studies, at least one additional study.

And then now that you're going to do a PALISADE-3, as we think about the potential outcomes, do you think PALISADE-3 would look similar to what you saw in PALISADE-2 or something even better because, I don't know, PALISADE-2, there's maybe some COVID going on. But the counter argument would be maybe there's some expectation bias due to the positive results. So how are you thinking about the outcome of PALISADE-3 and why?

Well, I think there's a lot of reasons, of course, to be confident about our next couple of steps in the PALISADE-3 direction. First, certainly, the world isn't really controlled anywhere near to the degree it was in the pandemic, and that obviously impacts the entire ecosystem associated with executing successful clinical studies. There's a lot of lessons learned that we have been able to gather from deconstruction of PALISADE-1 for sure, and I suspect we will from PALISADE-2, things like subjects will have an olfactory smell test. They'll have - will have restrictions on use of nasal swabs upfront of the event. So there are several things that are associated with just modest amendments to the protocol, but they're positive lessons that you typically learn when you stagger start the studies. So that, plus the training that we've done, the proprietary training models that we have all up and down every aspect of conducting that type of study, I don't think there's anybody better to conduct and more expertised to conduct a public speaking challenge in a Phase 3 setting than we are. I have no reservations about that. So I really - I like our chances going into the study. I like the expertise we have internally. I like the force extenders that we've got in our network outside the company. Certainly, Dr. Liebowitz plays a key role in our ability to be successful with this clinical program with this drug. So yes, we're excited.

Got it. Okay. And speaking PALISADE-2, going back to the data, when could we expect you to share detailed results at a medical meeting or a publication? I mean it would be great to see the curves of SUDS and so forth. And secondly, you've compared PALISADE-2 to PALISADE-1, explained the differences. But can you also compare to the prior Phase 2 study and maybe compare and contrast any efficacy differences that you saw? Were there different baseline SUDS scores, for instance, between these two studies? Help us reconcile any differences.

Thanks. Well, first to your question about the data, this obviously falls into industry standard breaking news, so we're trying to find a nice place to present the Phase 2 data in a breaking news context. Hopefully, sometime this fall, I think would probably be the earliest. So we'll have more information on that as we go forward. Certainly, abstracts and the like are already in circulation. So - and then as to your questions about has the PALISADE-2 - or the Phase 2 studies, I mean, obviously, it's a different environment. That's the three study - or 3-site study. But Josh Prince, I want you to actually just address this just briefly, some of the things that we see.

Yes. Thanks, Shawn. Just to fill in the space there, I think the key is the time difference. So when we think about how long it's been since those earlier Phase 2 studies were done and you think about just the environment that we live in today versus then and through the pandemic, we think that has effect. But overall, the efficacy seen for both PH94B and placebo in that Phase 2 study was everything was kind of shifted up compared to what we've seen with PALISADE-2 and PALISADE-1. I mean we really do think it has to do with kind of the - again, the times and the types of patients and conducting a study through the pandemic.

Thank you very much.

Thanks Andrew.

And our next question is from the line of Joanne Lee from Maxim Group. Please go ahead.

Hi. Good afternoon. Thanks for taking the questions and congratulations on the successful outcomes of the recent Phase 3. The results were truly remarkable. Just given fasedienol achieved positive results in now both PAL-2 and the open label study, could you provide some insight on the rationale behind choosing to pursue both SUDS and LSAS as primary measures in the PAL-3 and FEARLESS studies? Was this decision influenced by any guidance from the FDA? Just curious on that.

No, no. Well, Thanks, Joanne, first of all, for the question. It's a great question. Look, we long held the way that we think fasedienol can help people. It's two distinct ways. It can certainly help people, as we've shown in PALISADE-2, in an acute setting. And as they take it out of their pocket or their purse or their backpack and they use it on demand in a patient-tailored way, has the ability to knock down very rapidly those symptoms. That's what PALISADE-2 showed. We also have placebo-controlled Phase 2 data and some exploratory data from the open label. Lots of subjects that also when it's used acutely but used over time, it increases the confidence of a person and increases their resilience, and it reduces their tendency to avoid situations that could benefit their lives. It reduces the opportunity costs in their life. And that avoidance - a reduction in avoidance of engaging in social and performance situations is important. The Liebowitz scale captures both of those. So we're at a perfect spot right now because we've got one successful study in Phase 3, and you only need two adequate and well-controlled studies to get an approval of a drug. And so it could either be from a PALISADE-3 or it could be from a FEARLESS. Either way, what we're trying to do is look to the most efficient path to get this drug to patients as soon as possible. And it's one of those two tracks. It could be both, but you only need one other besides the one we've got. At least that's our opinion at this point. So doing the LSAS-based study, again, it's consistent with the only three drugs ever approved for treatment of social anxiety disorder. That was the primary efficacy end point.…

Got it. That was really helpful. And clearly, lots of excitement around the SAD program, but we're also really enthusiastic about the broader pherine platform as well. Could you shed some color on the current statuses and progress of those programs, PH10, 15 and 80, particularly on the latter, PH80, with the positive preclinical data? We see the hot flashing, other symptoms in menopause receiving a lot of - a lot more attention in the area of women's health. So curious if you could walk us through some of the time lines around those programs.

Sure. Well, first, with respect to itruvone, or PH10, that's now, after a bit of a long run, it's staged to go into Phase 2b development in the U.S. Those - the efficacy study was run outside the U.S. And so we really had to start back to the point of the U.S. IND-enabling program. For that one, because there had been no prior U.S. activity or no prior U.S. IND, we did the whole standard battery of nonclinical studies followed by a small Phase 1 to then now be able to leap back over, we believe, the Phase 2a that was done and move into Phase 2b, so tremendously exciting program given what we just also learned that, like 94B or fasedienol, there's no meaningful systemic exposure. And the kinds of safety profile benefits that we see from fasedienol are also in the itruvone zone, meaning that we didn't - we don't anticipate sexual side effects. We don't anticipate weight gain. We don't anticipate many of the types of side effects and safety concerns that are associated with the currently approved systemic therapy. So very excited about that as the stand-alone treatment for major depressive disorder. As to PH80, again, you hit it. Hot flashes is hot right now. With the new NK3 antagonist that was approved, there's been a lot more interest of late in that space. There's an enormous population course that's affected by hot flashes for many years with very limited options that don't cause some concern, whether it's hormonal therapy or the new class. PH80 is majorly distinguished from both of those current treatment options and the antidepressants that are used for hot flashes because, again, like fasedienol and itruvone, we don't believe it's systemically absorbed. We think, again, that it also has the ability with neurocircuitry that's associated with temperature to be able to reduce the daily number of hot flashes that - just as we saw in the Phase 2a study but also the severity of those hot flashes and the types of things that disrupt lives, so sweating and function and the like. So it's exciting that the challenge with that one is, like PH10, we've got to go through what probably will be about a 12 to 15 months IND-enabling program, where we do the CMC work and the preclinical work that's needed to get back into a Phase 2b setting. The difference with this one is that there is a - there were - there was a prior U.S. IND. So we don't think we need to do a Phase 1 study in order to get into Phase 2b for this indication. So will be - it's not a long - it's not a lot of money, less than $2 million for these IND-enabling programs. We have to do similar work with PH15 and PH284, the other two pherine assets in the pipeline. So that's the status of both.

Got it. Thank you for all the additional details. Once again, congratulations and looking forward to more updates this year.

Thanks, Joanne.

And our next question is a follow-up from the line of Andrew Tsai with Jefferies. Andrew, your line is live. Please proceed with your question.

Thank you. Just a couple of more questions. Thank you so much for the time. I mean going back to PALISADE-2, there does seem to be a consistent efficacy signal across various end points. So I just wanted to make sure, were there other prespecified efficacy measures part of the study? And if so, how did those look? Just wanted to make sure all pre-specified measures are separated from placebo in a stat sig manner. Thanks.

Sorry, Andrew. Were - you asked if there is a separation against placebo across all the end points. Yes, there was one secondary - the primary, one secondary and two exploratories, and we reported on all those, so four total.

Okay. Great. And going to the label - the eventual label, if both PALISADE and FEARLESS succeeded, what would your eventual label look like for SAD? And would there be precedents around that label claim? Thank you.

No, there is no precedent for the acute treatment for social anxiety disorder. We would be the first to blaze that trail with fasedienol. Drugs are used. Benzodiazepines, for example, try to achieve that but with considerable risk of abuse and misuse and addiction. But they're never - they're not approved for the treatment of social anxiety disorder. So only the three antidepressants: two SSRIs and one wellness, and they are approved for the chronic condition. There likely would be no limit, in our opinion, on how frequently somebody could use the drug acutely if it's PALISADE-2 plus PALISADE-3 that supports the label initially. If it's later, eventually, FEARLESS came along and the staggered starts, which we - is what we anticipate with PALISADE-3 first and FEARLESS second sometime in '24. It would be a case where the drug would be used acutely as needed but over time. And what you'd try to achieve for someone ultimately at the end of the day is they wouldn't have to take the drug. That's often and hopefully still also combined with talk therapy. So yes, the PALISADE-2 hits the acute side of that match set. FEARLESS would hit the over time, although certainly, people wouldn't be precluded from using fasedienol over time if what's achieved is only the acute label.

Got it. And really quickly, as we think about the NDA package in the future, any peripheral studies that you would need to do such as, I guess, repeat - just multiple dosing per day kind of studies, for instance? Thank you.

Sure. So we'll do open-label extensions on each of the 2, the PALISADE-3 and the FEARLESS study, so that there still has to be a safety database that gets established. And then the readout study that you mentioned, so I think that's something we've reported before. FDA wants to see what happens if someone uses the drug twice instead of just once in that acute setting. So that's something we will - before NDA, that's a small study that we'd likely be completing and most likely they'd be using a public speaking challenge as well. So not too many subjects, not too expensive, but again, trying to - not so much for safety, and we don't really worry about multiple uses in a short period of time, but I think there is some interest at the agency and wondering whether more is better. We've certainly established the 3.2 micrograms used PRN is good in PALISADE-2. So if better is available, great, but it won't be an essential component for going forward in PALISADE-3 or the FEARLESS study.

Got it. Actually, very last one, because you don't have much opportunity on conference calls. So in the study results, did PH94B work equally as well between male and females? And that's the last question. Thank you.

I think that's something we'll be able to unpack. We don't have the full data set fully unpacked. We have the top line results. So that takes a little bit of time. But I don't think we see - and we've long held since - that was, I think, long, long time ago that, that was a question. But we think - we don't think there's any reason to believe the drug doesn't work as well in women as in men or men as an women, whichever way you want to put it. But FEARLESS will give us - okay.

Okay. Thanks. Congrats.

Thank you.

And there are no other sell-side analysts in queue. You may proceed to closing comments.

Excellent. Thank you, Jennifer for your help today. And thank you, Andrew, and Joanne. We appreciate your questions. If there are any additional questions, please do not hesitate to contact us by e-mailing ir@vistagen.com or contacting the individuals listed in our press release issued today or on our website. We are - we also encourage you to sign up on our website to stay connected with the latest news from Vistagen. Thank you for participating in our call today. We appreciate everybody's attention and support. We look forward to keeping you current on our continuing progress. This concludes our call. Have a fantastic day. You may all disconnect now.