What changed in this filing

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Item 1. Financial Statements

2020-11-12 compared with 2020-08-12 · 808 added, 718 removed, 304 unchanged (83% of the section changed)

FINANCIAL STATEMENTS

Therapeutics, Inc.

Balance Sheets

Relmada Therapeutics, Inc.

Consolidated Balance Sheets

September 30,

Current assets:

12 unchanged sentences

Accrued expenses

Notes payable

Total current liabilities

11 unchanged sentences

$ 117,136,140

accompanying notes are an integral part of these unaudited consolidated financial statements.

Therapeutics, Inc.

Statements of Operations

The accompanying notes are an integral part

of these unaudited consolidated financial statements.

Relmada Therapeutics, Inc.

Consolidated Statements of Operations

Three months ended

Six months ended

Nine months ended

September 30,

Operating expenses:

5 unchanged sentences

(39,915,222 )

(10,545,116 )

Other (expenses) income:

Interest/investment income, net

Realized gain (loss) on short-term investments

Realized loss on short-term investments

Unrealized gain on short-term investments

8 unchanged sentences

basic and diluted

accompanying notes are an integral part of these unaudited consolidated financial statements.

The accompanying notes are an integral part

of these unaudited consolidated financial statements.

Relmada Therapeutics, Inc.

Consolidated Statements of Stockholders’

Six months ended June 30, 2020

Additional Paid-in

Nine months ended September 30, 2020

Balance - December 31, 2019

10 unchanged sentences

$ 243,676,817

$ (130,532,225 )

$ 113,159,533

Stock based compensation

2 unchanged sentences

Options exercised

ATM offering, net of offering costs

Equity offering, net

(11,118,441 )

4 unchanged sentences

$ 132,233,349

Six months ended June 30, 2019

Additional Paid-in

Stock based compensation

Warrant exercised for cash

Cashless warrant exercise

Options exercised

Cashless option exercised

Equity offering costs

(16,902,507 )

Balance - September 30, 2020

$ 280,746,968

$ (158,553,173 )

$ 122,209,984

Nine months ended September 30, 2019

Balance - December 31, 2018

6 unchanged sentences

$ 108,005,928

$ (107,539,775 )

Stock-based compensation expense

4 unchanged sentences

$ (111,662,367 )

Stock-based compensation expense

Purchase of common stock

Warrants exercised

Balance - September 30, 2019

$ 121,299,210

$ (115,331,861 )

The accompanying notes are an integral part

of these unaudited consolidated financial statements.

Therapeutics, Inc.

Statements of Cash Flows

Six months ended

Relmada Therapeutics, Inc.

Consolidated Statements of Cash Flows

Nine months ended

September 30,

Cash flows from operating activities

8 unchanged sentences

Change in operating assets and liabilities:

Other receivable

Lease payment receivable

3 unchanged sentences

Net cash used in operating activities

(20,880,039 )

Cash flows from investing activities

6 unchanged sentences

Principal payments of notes payable

Proceeds from issuance of common stock

Proceeds from issuance of common stock - net

Proceeds from options exercised for common stock

9 unchanged sentences

Cashless exercise of warrants for common stock

Cashless exercise of options for common stock

Notes payable issued in connection with directors and officers insurance policies

accompanying notes are an integral part of these unaudited consolidated financial statements.

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

Therapeutics, Inc.

(Relmada or the Company) (a Nevada corporation), is a clinical-stage, publicly traded biotechnology company

focused on the development of d-methadone (dextromethadone, REL-1017), an N-methyl-D-aspartate (NMDA) receptor antagonist.

is a New Chemical Entity (NCE) that potentially addresses areas of high unmet medical need in the treatment of central nervous

system (CNS) diseases and other disorders.

On October 7, 2019, our application to list

our common stock on the NASDAQ Capital Market was approved.

On October 10, 2019, our common stock began trading on Nasdaq under

our existing symbol, “RLMD.”

On July 14, 2020, our common stock was uplisted to The Nasdaq Global Select Market and

continues to trade under the symbol “RLMD”.

December 19, 2019, the Board of Directors of the Company approved a change to its end of fiscal year from June 30 to December

The change in fiscal year became effective for the Company’s 2020 fiscal year, which began on January 1, 2020 and will

end December 31, 2020.

addition to the normal risks associated with a new business venture, there can be no assurance that the Company’s research

and development will be successfully completed or that any product will be approved or commercially viable.

The Company is subject

to risks common to companies in the biotechnology industry including, but not limited to, dependence on collaborative arrangements,

development by the Company or its competitors of new technological innovations, dependence on key personnel, protection of proprietary

technology, and compliance with the FDA and other governmental regulations and approval requirements.

2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

of Presentation

accompanying unaudited consolidated financial statements and related notes have been prepared in accordance with accounting principles

generally accepted in the United States of America (U.S.

The accompanying notes are an integral part

of these unaudited consolidated financial statements.

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 1 - BUSINESS

Relmada Therapeutics, Inc.

the Company, we or us) (a Nevada corporation), is a clinical-stage biotechnology company focused on the development of REL-1017

(d-methadone, dextromethadone), an N-methyl-D-aspartate (NMDA) receptor antagonist.

d-methadone is a new chemical entity (NCE)

that potentially addresses areas of high unmet medical need in the treatment of central nervous system (CNS) diseases and other

On October 7, 2019, our application to

list our common stock on the NASDAQ Capital Market was approved.

On October 10, 2019, our common stock began trading on Nasdaq

under our existing symbol, “RLMD.”

On July 14, 2020, our common stock was uplisted to The Nasdaq Global Select Market

and continues to trade under the symbol “RLMD”.

On December 19, 2019, the Board of Directors

of the Company approved a change to its end of fiscal year from June 30 to December 31.

The change in fiscal year became effective

for the Company’s 2020 fiscal year, which began on January 1, 2020 and will end December 31, 2020.

In addition to the normal risks associated

with a new business venture, there can be no assurance that the Company’s research and development will be successfully completed

or that any product will be approved or commercially viable.

The Company is subject to risks common to companies in the biotechnology

industry including, but not limited to, dependence on collaborative arrangements, development by the Company or its competitors

of new technological innovations, dependence on key personnel, protection of proprietary technology, and compliance with the FDA

and other governmental regulations and approval requirements.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING

Basis of Presentation

The accompanying unaudited consolidated

financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United

States of America (U.S.

GAAP) for interim unaudited consolidated financial information.

they do not include all of the information and footnotes required by U.S.

Accordingly, they do not include all of

the information and footnotes required by U.S.

GAAP for complete consolidated financial statements.

The unaudited consolidated financial statements reflect all adjustments (consisting of normal recurring adjustments) which are,

in the opinion of management, necessary for a fair statement of the results for the interim periods presented.

Interim results

are not necessarily indicative of the results for the full year.

These unaudited consolidated financial statements should be read

in conjunction with the audited consolidated financial statements of the Company for the six months ended December 31, 2019 and

notes thereto contained in the Company’s Transition Report on Form 10-KT.

The unaudited consolidated

financial statements reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management,

necessary for a fair statement of the results for the interim periods presented.

Interim results are not necessarily indicative

of the results for the full year.

These unaudited consolidated financial statements should be read in conjunction with the audited

consolidated financial statements of the Company for the six months ended December 31, 2019 and notes thereto contained in the

Company’s Transition Report on Form 10-KT.

On September 26, 2019, the Company’s

5 unchanged sentences

retroactively restated to reflect this reverse stock split.

As shown in the accompanying financial

statements, the Company incurred negative operating cash flows of $8,378,419 for the six months ended June 30, 2020 and has an

accumulated deficit of $141,650,666 from inception through June 30, 2020.

At June 30, 2020 the Company had cash and short term

investments of approximately $134,087,800.

As shown in the accompanying financial statements,

the Company incurred negative operating cash flows of $20.9 million for the nine months ended September 30, 2020 and has an accumulated

deficit of $158.6 million from inception through September 30, 2020.

At September 30, 2020 the Company had cash and short term

investments of $123.1 million.

Relmada has funded its past operations

through equity raises and most recently in 2020 raised net proceeds from the sale of common stock of $19,855,018 through our ATM

offering and $5,619,276 through the exercise of warrants.

The Company also raised an additional $530,643 during the six months

ended June 30, 2020 from the exercises of options.

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Management believes that due to the recent equity raises completed

and exercises of outstanding warrants and the current cash position on its balance sheet, it has obtained sufficient funding to

continue ongoing operations for at least 12 months from the issuance of these unaudited consolidated quarterly financial statements.

Since June 30, 2020 and to date, the Company has received approximately $1,230,000 in warrant exercises, which resulted in the

Company having approximately $131,549,600 million in cash, cash equivalents, and short term investments at August 5, 2020.

on its budgeted cash flow requirements, the Company believes these funds are sufficient to fund its ongoing operations for at least

12 months after the issuance of these unaudited consolidated quarterly financial statements.

Regardless of the results of any ongoing

clinical trial, the Company has control over its expenditures and has the ability to adjust spending accordingly based on the budgeted

cash flow requirements developed and the excess cash on hand.

believes that their existing cash and cash equivalents will enable them to fund operating expenses and capital expenditure requirement

for at least the next 12 months.

Beyond that point management will evaluate the size and scope of any subsequent trials that will

affect the timing of additional financings through public or private sales of equity or debt securities or from bank or other

loans or through strategic collaboration and/or licensing agreements.

Any such expenditures related to any subsequent trials will

not be incurred until such additional financing is raised.

Further, additional financing related to subsequent trials does not

affect the Company’s conclusion that based on the cash on hand and the budgeted cash flow requirements, the Company has

sufficient funds to maintain operations for at least 12 months from the issuance of these consolidated financial statements.

of Consolidation

unaudited consolidated financial statements include the Company’s accounts and those of the Company’s wholly-owned

All significant intercompany accounts and transactions have been eliminated in consolidation.

and Uncertainties

pandemic caused by an outbreak of a new strain of coronavirus (COVID-19) has resulted, and is likely to continue to result, in

significant national and global economic disruption and may adversely affect our business.

Based on the Company’s current

assessment, the Company does not expect any material impact on its long-term development timeline and its liquidity due to the

worldwide spread of the COVID-19 virus.

However, the Company is actively monitoring this situation and the possible effects on

its financial condition, liquidity, operations, suppliers, industry, and workforce.

preparation of financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect

the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial

statements and the reported amounts of revenues and expenses for the reporting period.

Actual results could differ from those

The significant estimates are the valuation of stock-based compensation expenses and recorded amounts related to income

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

and Cash Equivalents

Company considers cash deposits and all highly liquid investments with a maturity of three months or less when purchased to be

cash equivalents.

The Company’s cash deposits are held at two high-credit-quality financial institutions.

through equity raises and most recently in 2020 raised net proceeds from the sale of common stock of $19,816,597 and $7,186,306 through the exercise of warrants.

The Company also raised an additional $636,518 during the nine months

ended September 30, 2020 from the exercises of options.

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Management believes that due to the

recent equity raises completed and exercises of outstanding options and warrants and the current cash position on its balance

sheet, it has obtained sufficient funding to continue ongoing operations for at least 12 months from the issuance of these

unaudited consolidated quarterly financial statements.

Management believes that their existing

cash and cash equivalents will enable them to fund operating expenses and capital expenditure requirement for at least the next

Beyond that point management will evaluate the size and scope of any subsequent trials that will affect the timing of

additional financings through public or private sales of equity or debt securities or from bank or other loans or through strategic

collaboration and/or licensing agreements.

Any such expenditures related to any subsequent trials will not be incurred until such

additional financing is raised.

Further, additional financing related to subsequent trials does not affect the Company’s

conclusion that based on the cash on hand and the budgeted cash flow requirements, the Company has sufficient funds to maintain

operations for at least 12 months from the issuance of these consolidated financial statements.

Principles of Consolidation

The unaudited consolidated financial statements

include the Company’s accounts and those of the Company’s wholly-owned subsidiary.

All significant intercompany accounts

and transactions have been eliminated in consolidation.

Risks and Uncertainties

The pandemic caused by an outbreak of a

new strain of coronavirus (COVID-19) has resulted, and is likely to continue to result, in significant national and global economic

disruption and may adversely affect our business.

Based on the Company’s current assessment, the Company does not expect

any material impact on its long-term development timeline and its liquidity due to the worldwide spread of the COVID-19 virus.

However, the Company is actively monitoring this situation and the possible effects on its financial condition, liquidity, operations,

suppliers, industry, and workforce.

Use of Estimates

The preparation of financial statements

in conformity with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and

liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts

of revenues and expenses for the reporting period.

Actual results could differ from those estimates.

The significant estimates

are the valuation of stock-based compensation expenses and recorded amounts related to income taxes.

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Cash and Cash Equivalents

The Company considers cash deposits and

all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

The Company’s

cash deposits at these institutions exceed federally insured limits.

Company’s investments consist entirely of mutual funds.

The securities are measured at fair value based on the net asset

The Company adopted Financial Accounting Standards Board (FASB) Accounting Standard Update (ASU) 2016-01, Financial

Instruments, for the six months ended December 31, 2019 which requires substantially all equity investments in nonconsolidated

entities to be measured at fair value with recurring changes recognized in earnings, except for those accounted for using equity

method accounting.

Changes in fair value of the securities are recorded as part of other income on the consolidated statement

of operations.

Short term investment activity is presented in the investing activities section on the consolidated statement of

related to filing and pursuing patent applications are recorded as general and administrative expense and expensed as incurred

since recoverability of such expenditures is uncertain.

assets are stated at cost less accumulated depreciation.

Fixed assets are comprised of computers and software, leasehold improvements,

and furniture and fixtures.

Depreciation is calculated using the straight-line method over the estimated useful life of the assets.

Computers and software have an estimated useful life of three years.

Furniture and fixtures have an estimated useful life of approximately

Company recognizes its leases with a term of greater than a year on the balance sheet by recording right-of-use assets and lease

Leases can be classified as either operating leases or finance leases.

Operating leases will result in straight-line

lease expense, while finance leases will result in front-loaded expense.

The Company’s lease consists of an operating leases

for office space.

The Company does not recognize a lease liability or right-of-use asset on the balance sheet for short-term leases.

Instead, the Company recognizes short-term lease payments as an expense on a straight-line basis over the lease term.

lease is defined as a lease that, at the commencement date, has a lease term of 12 months or less and does not include an option

to purchase the underlying asset that the lessee is reasonably certain to exercise.

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Value of Financial Instruments

Company’s financial instruments primarily include cash, short term investments, and accounts payable.

Due to the short-term

nature of cash and accounts payable the carrying amounts of these assets and liabilities approximate their fair value.

value is defined as the price that would be received to sell an asset, or paid to transfer a liability (an exit price), in an

orderly transaction between market participants at the reporting date.

A fair value hierarchy has been established for valuation

inputs that gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority

to unobservable inputs.

The fair value hierarchy is as follows:

1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability

to access at the measurement date.

2 Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly

or indirectly.

These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical

or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset

or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally

from or corroborated by market data by correlation or other means.

3 Inputs - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable

(supported by little or no market activity).

cash deposits are held at two high-credit-quality financial institutions.

The Company’s cash deposits at these institutions

exceed federally insured limits.

Short-term Investments

The Company’s investments consist

entirely of mutual funds.

The securities are measured at fair value based on the net asset value (NAV).

The Company adopted Financial

Accounting Standards Board (FASB) Accounting Standard Update (ASU) 2016-01, Financial Instruments, for the six months ended December

31, 2019 which requires substantially all equity investments in nonconsolidated entities to be measured at fair value with recurring

changes recognized in earnings, except for those accounted for using equity method accounting.

Changes in fair value of the securities

are recorded as part of other income on the consolidated statement of operations.

Short term investment activity is presented in

the investing activities section on the consolidated statement of cash flows.

Costs related to filing and pursuing patent

applications are recorded as general and administrative expense and expensed as incurred since recoverability of such expenditures

is uncertain.

Fixed assets are stated at cost less accumulated

depreciation.

Fixed assets are comprised of computers and software, leasehold improvements, and furniture and fixtures.

is calculated using the straight-line method over the estimated useful life of the assets.

Computers and software have an estimated

useful life of three years.

Furniture and fixtures have an estimated useful life of approximately seven years.

The Company recognizes its leases with

a term of greater than a year on the balance sheet by recording right-of-use assets and lease liabilities.

Leases can be classified

as either operating leases or finance leases.

Operating leases will result in straight-line lease expense, while finance leases

will result in front-loaded expense.

The Company’s lease consists of an operating lease for office space.

The Company does

not recognize a lease liability or right-of-use asset on the balance sheet for short-term leases.

Instead, the Company recognizes

short-term lease payments as an expense on a straight-line basis over the lease term.

A short-term lease is defined as a lease

that, at the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying

asset that the lessee is reasonably certain to exercise.

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Fair Value of Financial Instruments

The Company’s financial instruments

primarily include cash, short term investments, and accounts payable.

Due to the short-term nature of cash and accounts payable

the carrying amounts of these assets and liabilities approximate their fair value.

Fair value is defined as the price that

would be received to sell an asset, or paid to transfer a liability (an exit price), in an orderly transaction between market participants

at the reporting date.

A fair value hierarchy has been established for valuation inputs that gives the highest priority to quoted

prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs.

The fair value hierarchy

is as follows:

Level 1 Inputs - Unadjusted quoted prices

in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

Level 2 Inputs - Inputs other than quoted

prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.

These might include quoted

prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets

that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities,

prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation

or other means.

Level 3 Inputs - Prices or valuation techniques

that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market

The Company’s short-term investment

instruments of $120,263,581 at June 30, 2020 are classified using Level 1 inputs within the fair value hierarchy because they

are valued using NAV.

instruments of $115,593,750 at September 30, 2020 are classified using Level 1 inputs within the fair value hierarchy because

they are valued using NAV.

Unrealized gains and losses are recorded in the consolidated statement of operations under other income.

The Company recorded an unrealized gain of $287,027 included in other income for the six months ended June 30, 2020.

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Company accounts for income taxes using the asset and liability method.

Accordingly, deferred tax assets and liabilities are recognized

for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and

liabilities and their respective tax bases.

Deferred tax assets and liabilities are measured using enacted tax rates expected

to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

on deferred tax assets and liabilities of a change in the tax rate is recognized in income or expense in the period that the change

is effective.

Tax benefits are recognized when it is probable that the deduction will be sustained.

A valuation allowance is established

when it is more likely than not that all or a portion of a deferred tax asset will either expire before the Company is able to

realize the benefit, or that future deductibility is uncertain.

As of June 30, 2020 and December 31, 2019, the Company had recognized

a valuation allowance to the full extent of the Company’s net deferred tax assets since the likelihood of realization of

the benefit does not meet the more likely than not threshold.

Company files a U.S.

Federal income tax return and various state returns.

Uncertain tax positions taken on the Company’s

tax returns will be accounted for as liabilities for unrecognized tax benefits.

The Company will recognize interest and penalties,

if any, related to unrecognized tax benefits in general and administrative expenses in the statements of operations.

no liabilities recorded for uncertain tax positions at June 30, 2020 and December 31, 2019.

The open tax years, subject to potential

examination by the applicable taxing authority, for the Company are from June 30, 2017 forward.

and Development

and development costs primarily consist of research contracts for the advancement of product development, salaries and benefits,

stock-based compensation, and consultants.

The Company recorded an unrealized gain of $290,973 included in other income for the nine months ended September 30, 2020.

The Company accounts for income taxes using

the asset and liability method.

Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences

attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the

years in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities

of a change in the tax rate is recognized in income or expense in the period that the change is effective.

Tax benefits are recognized

when it is probable that the deduction will be sustained.

A valuation allowance is established when it is more likely than not

that all or a portion of a deferred tax asset will either expire before the Company is able to realize the benefit, or that future

deductibility is uncertain.

As of September 30, 2020 and December 31, 2019, the Company had recognized a valuation allowance to

the full extent of the Company’s net deferred tax assets since the likelihood of realization of the benefit does not meet

the more likely than not threshold.

The Company files a U.S.

Federal income

tax return and various state returns.

Uncertain tax positions taken on the Company’s tax returns will be accounted for as

liabilities for unrecognized tax benefits.

The Company will recognize interest and penalties, if any, related to unrecognized tax

benefits in general and administrative expenses in the statements of operations.

There were no liabilities recorded for uncertain

tax positions at September 30, 2020 and December 31, 2019.

The open tax years, subject to potential examination by the applicable

taxing authority, for the Company are from June 30, 2017 forward.

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Research and Development

Research and development costs primarily

consist of research contracts for the advancement of product development, salaries and benefits, stock-based compensation, and

The Company expenses all research and development costs in the period incurred.

Company makes an estimate of costs in relation to clinical study contracts.

The Company analyzes the progress of studies, including

the progress of clinical studies and phases, invoices received and contracted costs when evaluating the adequacy of the amount

expensed and the related prepaid asset and accrued liability.

Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date

fair value of the award.

That cost is recognized over the period during which an employee is required to provide service in exchange

for the award - the requisite service period.

The grant-date fair value of employee share options is estimated using the Black-Scholes

option pricing model adjusted for the unique characteristics of those instruments.

per Common Share

Basic loss per common share attributable to

common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of

common shares outstanding for the period, without consideration for common stock equivalents.

Diluted loss per common share attributable

to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average number

of common share equivalents outstanding for the period determined using the treasury-stock method.

Dilutive common stock equivalents

are comprised of options and warrants to purchase common stock.

For all periods presented, there is no difference in the number

of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss position.

the six months ended June 30, 2020 and 2019, the potentially dilutive securities that would be anti-dilutive due to the Company’s

net loss are not included in the calculation of diluted net loss per share attributable to common stockholders.

The anti-dilutive

securities are as follows (in common stock equivalent shares):

Six months ended

The Company makes an estimate of costs

in relation to clinical study contracts.

The Company analyzes the progress of studies, including the progress of clinical studies

and phases, invoices received and contracted costs when evaluating the adequacy of the amount expensed and the related prepaid

asset and accrued liability.

Stock-Based Compensation

The Company measures the cost of employee

services received in exchange for an award of equity instruments based on the grant-date fair value of the award.

recognized over the period during which an employee is required to provide service in exchange for the award - the requisite service

The grant-date fair value of employee share options is estimated using the Black-Scholes option pricing model adjusted

for the unique characteristics of those instruments.

Loss per Common Share

Basic loss per common share attributable

to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted-average number

of common shares outstanding for the period, without consideration for common stock equivalents.

Diluted loss per common share

attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted-average

number of common share equivalents outstanding for the period determined using the treasury-stock method.

Dilutive common stock

equivalents are comprised of options and warrants to purchase common stock.

For all periods presented, there is no difference in

the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss position.

For the nine months ended September 30,

2020 and 2019, the potentially dilutive securities that would be anti-dilutive due to the Company’s net loss are not included

in the calculation of diluted net loss per share attributable to common stockholders.

The anti-dilutive securities are as follows

(in common stock equivalent shares):

Nine months ended

September 30,

Stock options

Common stock warrants

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Accounting Pronouncements

December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes , which

is intended to simplify various aspects related to accounting for income taxes.

ASU 2019-12 removes certain exceptions to the

general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application.

This guidance

is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption

We do not expect the adoption of ASU 2019-12 to have a material impact on our consolidated financial statements.

In August 2018, FASB issued ASU 2018-13, Fair

Value Measurement –

Recent Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12,

Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes , which is intended to simplify various aspects related

to accounting for income taxes.

ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies

and amends existing guidance to improve consistent application.

This guidance is effective for fiscal years, and interim periods

within those fiscal years, beginning after December 15, 2020, with early adoption permitted.

We do not expect the adoption of ASU

2019-12 to have a material impact on our consolidated financial statements.

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

In August 2018, FASB issued ASU

2018-13, Fair Value Measurement –

Disclosure Framework (Topic 820).

The updated guidance improves the disclosure requirements on fair

value measurements, primarily associated with Level 3 fair value measurements and is effective for fiscal years, and interim periods

within those fiscal years, beginning December 15, 2019.

Early adoption is permitted upon issuance of the standard disclosures

modified or removed with a delay of adoption of the additional disclosures until their effective date.

The Company adopted this

standard effective January 1, 2020 and the standard did not have a significant impact on the Company’s financial statements.

In November 2018, FASB issued ASU 2018-18 –

Collaborative

Arrangements (Topic 808):

Clarifying the Interaction between Topic 808 and Topic 606 , which, among other things, provides guidance

on how to assess whether certain collaborative arrangement transactions should be accounted for under Topic 606.

The amendments

in the ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with

early adoption permitted.

The Company adopted this standard on January 1, 2020 and the standard did not have a significant impact

on the Company’s financial statements.

Company’s management reviewed all material events through the date the financial statements were issued for subsequent event

disclosure consideration.

3 - PREPAID EXPENSES

expenses consisted of the following (rounded to nearest $00):

The updated guidance improves the disclosure

requirements on fair value measurements, primarily associated with Level 3 fair value measurements and is effective for

fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.

Early adoption is permitted

upon issuance of the standard disclosures modified or removed with a delay of adoption of the additional disclosures until

their effective date.

The Company adopted this standard effective January 1, 2020 and the standard did not have a significant

impact on the Company’s financial statements.

In November 2018, FASB issued ASU 2018-18

Collaborative Arrangements (Topic 808):

Clarifying the Interaction between Topic 808 and Topic 606 , which, among

other things, provides guidance on how to assess whether certain collaborative arrangement transactions should be accounted for

under Topic 606.

The amendments in the ASU are effective for fiscal years, and interim periods within those fiscal years, beginning

after December 15, 2019, with early adoption permitted.

The Company adopted this standard on January 1, 2020 and the standard did

not have a significant impact on the Company’s financial statements.

Subsequent Events

The Company’s management reviewed

all material events through the date the financial statements were issued for subsequent event disclosure consideration.

NOTE 3 - PREPAID EXPENSES

Prepaid expenses consisted of the following (rounded to nearest

September 30,

Research and Development

4 - FIXED ASSETS

assets, net of accumulated depreciation, consisted of the following (rounded to nearest $00):

NOTE 4 - FIXED ASSETS

Fixed assets, net of accumulated depreciation, consisted of

the following (rounded to nearest $00):

September 30,

Computer and Software

accumulated depreciation

5 - ACCRUED EXPENSES

expenses consisted of the following (rounded to nearest $00):

NOTE 5 - ACCRUED EXPENSES

Accrued expenses consisted of the following (rounded to nearest

September 30,

Research and development

3 unchanged sentences

Legal settlement

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

6 - NOTES PAYABLE

June 2019, the Company entered into a note for approximately $364,200 in conjunction with a renewal of its director and officer

insurance policy.

The interest rate was 3.09% per annum.

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 6 - NOTE PAYABLE

In June 2019, the Company entered into

a note for approximately $364,200 in conjunction with a renewal of its director and officer insurance policy.

The interest rate

was 3.09% per annum.

The note matured on April 9, 2020.

June 30, 2020 and December 31, 2019, the note payable outstanding balances were approximately $0 and $110,200, respectively.

7 - STOCKHOLDERS’

At September 30, 2020 and December 31,

2019, the note payable outstanding balances were approximately $0 and $110,200, respectively.

NOTE 7 - STOCKHOLDERS’

On September 26, 2019, the Company’s

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retroactively restated to reflect this reverse stock split.

During the six months ended June 30,

During the nine months ended September

30, 2020, the Company issued shares of common stock for cashless exercise of warrants.

The Company also issued

815,471 shares of common stock for cash exercises of warrants for proceeds of $5,619,276.

During the six months ended June 30, 2020,

The Company also issued shares of common

stock for cash exercises of warrants for proceeds of $7,186,306.

During the nine months ended September

30, 2020, the Company issued shares of common stock for cashless exercise of options.

During the nine months ended September 30,

2020, the Company issued shares of common stock for the exercise of options for proceeds of $636,518.

On May 15, 2020, the Company entered into an

Open Market Sale Agreement with Jefferies LLC, as sales agent (“Jefferies”), pursuant to which the Company may

offer and sell, from time to time, through Jefferies, shares of the Company’s common stock, having an aggregate offering

On May 15, 2020, the Company entered into

an Open Market Sale Agreement with Jefferies LLC, as sales agent (“Jefferies”), pursuant to which the Company

may offer and sell, from time to time, through Jefferies, shares of the Company’s common stock, having an aggregate offering

price of up to $75,000,000 .

The Company is not obligated to sell any shares under the agreement.

During the six months ended June

30, 2020 the Company issued 427,700 shares of common stock for net cash proceeds of $19,900,000 million under the agreement.

During the nine months ended

September 30, 2020 the Company issued shares of common stock for net cash proceeds of $19,816,597 under the agreement.

Options and Warrants

In December 2014, the Board of Directors

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The Plan allowed for the granting of 5,152,942 options or stock awards.

Stock options are exercisable generally for a period of 10 years

from the date of grant and generally vest over four years.

As of June 30, 2020, 1,018,367 shares were available for future grants

under the Plan.

of June 30, 2020, no stock appreciation rights have been issued.

The Company utilizes the Black-Scholes option pricing model

to estimate the fair value of stock options and warrants.

The risk-free interest rate assumptions were based upon the observed

interest rates appropriate for the expected term of the equity instruments.

The expected dividend yield was assumed to be zero

as the Company has not paid any dividends since its inception and does not anticipate paying dividends in the foreseeable future.

Stock options are exercisable generally for

a period of 10 years from the date of grant and generally vest over four years.

As of September 30, 2020, 1,042,520 shares were

available for future grants under the Plan.

As of September 30, 2020, no stock appreciation

rights have been issued.

The Company utilizes the Black-Scholes

option pricing model to estimate the fair value of stock options and warrants.

The risk-free interest rate assumptions were based

upon the observed interest rates appropriate for the expected term of the equity instruments.

The expected dividend yield was assumed

to be zero as the Company has not paid any dividends since its inception and does not anticipate paying dividends in the foreseeable

The expected volatility was based on historical volatility.

The Company routinely reviews its calculation of volatility changes

in future volatility, the Company’s life cycle, its peer group, and other factors.

Company uses the simplified method for share-based compensation to estimate the expected term for employee option awards for share-based

compensation in its option-pricing model.

March 9, 2020, the Company awarded a total of 350,000 options to an employee with exercise price of $45.61 and a 10-year term

vesting over 4-year period.

The Company routinely reviews its calculation of volatility

changes in future volatility, the Company’s life cycle, its peer group, and other factors.

The Company uses the simplified

method for share-based compensation to estimate the expected term for equity awards for share-based compensation in its

option-pricing model.

During the nine months ended September

30, 2020, the Company awarded a total of 950,000 options to employees with exercise price ranging from $28.00- $45.61 and a 10-year

term vesting over 4-year period.

The options have an aggregate fair value of $31.1 million calculated using the Black-Scholes option-pricing

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6.25 years, (3) expected volatility of 106%-108%, and (4) zero expected dividends.

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

7 - STOCKHOLDERS’

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 7 - STOCKHOLDERS’

EQUITY (continued)

March 19, 2020, the Company awarded a total of 100,000 options to an employee with exercise price of $28.00 and a 10-year term

vesting over a 4-year period.

The options have an aggregate fair value of $2.3 million calculated using the Black-Scholes option-pricing

Variables used in the Black-Scholes option-pricing model include:

(1) discount rate of 0.83% (2) expected life of 6.25

years, (3) expected volatility of 108%, and (4) zero expected dividends.

March 25, 2020, the Company awarded a total of 150,000 options to an employee with exercise price of $31.88 and a 10-year term

vesting over a 4-year period.

The options have an aggregate fair value of $4.0 million calculated using the Black-Scholes option-pricing

Variables used in the Black-Scholes option-pricing model include:

(1) discount rate of 0.67% (2) expected life of 6.25

years, (3) expected volatility of 108%, and (4) zero expected dividends.

On April 21, 2020, the Company awarded

a total of 100,000 options to an employee with exercise price of $33.29 and a 10-year term vesting over a 4-year period.

have an aggregate fair value of $2.7 million calculated using the Black-Scholes option-pricing model.

Variables used in the Black-Scholes

option-pricing model include:

(1) discount rate of 0.41% (2) expected life of 6.25 years, (3) expected volatility of 108%, and

(4) zero expected dividends.

On May 20, 2020, the Company awarded a

total of 150,000 options to an employee with exercise price of $45.25 and a 10-year term vesting over a 4-year period.

have an aggregate fair value of $5.6 million calculated using the Black-Scholes option-pricing model.

Variables used in the Black-Scholes

option-pricing model include:

(1) discount rate of 0.44% (2) expected life of 6.25 years, (3) expected volatility of 107%, and

(4) zero expected dividends

At June 30, 2020, the Company has unrecognized

stock-based compensation expense of approximately $69,788,000 related to unvested stock options over the weighted average remaining

service period of 3.5 years.

During the six months

ended June 30, 2020, the Company recognized additional compensation expense of approximately $1.5 million related to acceleration

of vesting and a nominal amount related to the modification of certain options in connection with the separation and settlement

agreement with Dr.

At September 30, 2020, the Company has

unrecognized stock-based compensation expense of approximately $67,964,000 related to unvested stock options over the weighted

average remaining service period of 3.29 years.

the nine months ended September 30, 2020, the Company recognized additional compensation expense of approximately $1,500,000 related

to acceleration of vesting and a nominal amount related to the modification of certain options in connection with the separation

and settlement agreement with Dr.

Ottavio Vitolo (see note 8).

summary of the changes in options during the six months ended June 30, 2020 is as follows:

A summary of the changes in options during

the nine months ended September 30, 2020 is as follows:

Outstanding and expected to vest at December 31, 2019

Outstanding and expected to vest at June 30, 2020

Options exercisable at June 30, 2020

Outstanding at September 30, 2020

Options exercisable at September 30, 2020

A summary of the changes in outstanding warrants during the

six months ended June 30, 2020 is as follows:

nine months ended September 30, 2020 is as follows:

Outstanding and vested at December 31, 2019

Outstanding and vested at June 30, 2020

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

7 - STOCKHOLDERS’

Outstanding at September 30, 2020

Warrants exercisable at September 30, 2020

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 7 - STOCKHOLDERS’

EQUITY (continued)

14 unchanged sentences

zero expected dividends.

At June 30, 2020 the Company had approximately

$103,000 of unrecognized compensation expense related to outstanding warrants.

At June 30, 2020 and December 31,

2019, the aggregate intrinsic value of warrants vested and outstanding was approximately $106,423,000 and $115,731,000,

respectively.

At September 30, 2020, the Company had

approximately $90,400 of unrecognized compensation expense related to outstanding warrants.

At September 30, 2020 and December 31,

2019, the aggregate intrinsic value of warrants vested and outstanding was approximately $78,875,000 and $115,731,000, respectively.

The following summarizes the components

of stock-based compensation expense which includes stock options and warrants in the unaudited consolidated statements of operations

for the six months ended June 30, 2020 and 2019 (rounded to nearest $00):

for the nine months ended September 30, 2020 and 2019 (rounded to nearest $00):

September 30,

Research and development

General and administrative

8 - RELATED PARTY TRANSACTIONS

March 6, 2020, Dr.

Vitolo entered into a Separation and Severance Agreement with the Company.

Pursuant to the terms of the agreement,

the Company agreed to pay Dr.

NOTE 8 - RELATED PARTY TRANSACTIONS

Effective March 6, 2020, Dr.

Vitolo entered

into a Separation and Severance Agreement with the Company.

Pursuant to the terms of the agreement, the Company agreed to pay Dr.

Vitolo severance of $200,000 in accordance with his employment contract.

In addition, Dr.

Vitolo’s

options granted under the Company’s 2014 Stock Option and Equity Incentive Plan will continue to vest until September 6,

Vitolo shall have until March 6, 2021 to exercise his vested options and he shall be allowed to use a cashless exercise

provision to exercise his vested options.

The agreement also contains customary confidentiality, release, and non-disparagement

provisions, and the Company agreed to pay accrued and unpaid salary, vacation time and attorney’s fees totaling approximately $45,000.

March 9, 2020, the Company appointed Dr.

Vitolo’s options granted under

the Company’s 2014 Stock Option and Equity Incentive Plan continued to vest until September 6, 2020.

have until March 6, 2021 to exercise his vested options and he shall be allowed to use a cashless exercise provision to exercise

his vested options.

The agreement also contains customary confidentiality, release, and non-disparagement provisions, and the Company

agreed to pay accrued and unpaid salary, vacation time and attorney’s fees totaling approximately $45,000.

On March 9, 2020, the Company appointed

Thomas Wessel as the Company’s Executive Vice President, Head of Research and Development.

9 - COMMITMENTS AND CONTINGENCIES

On August 20, 2007, the Company

entered into a License Development and Commercialization Agreement with Wonpung Mulsan Co, a shareholder of the Company.

Wonpung has exclusive territorial rights in countries it selects in Asia to market up to two drugs the Company is currently

developing and a right of first refusal (“ROFR”) for up to an additional five drugs that the Company may develop

in the future as defined in more detail in the license agreement.

If the parties cannot agree to terms of a license agreement

then the Company shall be able to engage in discussions with other potential licensors.

As of July 2020, no discussions are

active between the Company and Wonpung.

Company received an upfront license fee of $1,500,000 and will earn royalties of up to 12% of net sales for up to two licensed

products it is currently developing.

The licensing terms for the ROFR products are subject to future negotiations and binding

The terms of each licensing agreement will expire on the earlier of any time from 15 years to 20 years after licensing

or on the date of commercial availability of a generic product to such licensed product in the licensed territory.

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

9 - COMMITMENTS AND CONTINGENCIES (continued)

Party Licensor

NOTE 9 - COMMITMENTS AND CONTINGENCIES

License Agreements

On August 20, 2007, the Company entered

into a License Development and Commercialization Agreement with Wonpung Mulsan Co, a shareholder of the Company.

Wonpung has exclusive

territorial rights in countries it selects in Asia to market up to two drugs the Company is currently developing and a right of

first refusal (“ROFR”) for up to an additional five drugs that the Company may develop in the future as defined in

more detail in the license agreement.

If the parties cannot agree to terms of a license agreement then the Company shall be able

to engage in discussions with other potential licensors.

As of November 12, 2020, no discussions are active between the Company

The Company received an upfront license

fee of $1,500,000 and will earn royalties of up to 12% of net sales for up to two licensed products it is currently developing.

The licensing terms for the ROFR products are subject to future negotiations and binding arbitration.

The terms of each licensing

agreement will expire on the earlier of any time from 15 years to 20 years after licensing or on the date of commercial availability

of a generic product to such licensed product in the licensed territory.

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 9 - COMMITMENTS AND CONTINGENCIES

Third Party Licensor

Based upon a prior acquisition, the Company

10 unchanged sentences

first commercial sale of product in the field of product that has more than one active pharmaceutical ingredient, respectively.

As of June 30, 2020, the Company has not generated any revenue related to this license agreement.

In January 2018, we entered into an Intellectual

Property Assignment Agreement (the Assignment Agreement) and License Agreement (the License Agreement and together with the Assignment

Agreement, the Agreements) with Dr.

As of September 30, 2020, the Company has not generated any revenue related to this license agreement.

Inturrisi / Manfredi

In January 2018, we entered into an

Intellectual Property Assignment Agreement (the Assignment Agreement) and License Agreement (the License Agreement and together

with the Assignment Agreement, the Agreements) with Dr.

Inturrisi and Dr.

Paolo Manfredi (collectively, the Licensor).

the Agreements, Relmada assigned its existing rights, including patents and patent applications, to d-methadone in the context

of psychiatric use (the Existing Invention) to Licensor.

Licensor then granted Relmada under the License Agreement a perpetual,

worldwide, and exclusive license to commercialize the Existing Invention and certain further inventions regarding d-methadone.

consideration of the rights granted to Relmada under the License Agreement, Relmada paid the Licensor an upfront, non-refundable

license fee of $180,000.

Additionally, Relmada will pay Licensor $45,000 every three months until the earliest to occur of the

following events:

(i) the first commercial sale of a licensed product anywhere in the world, (ii) the expiration or invalidation

of the last to expire or be invalidated of the patent rights anywhere in the world, or (iii) the termination of the License Agreement.

Relmada will also pay Licensor tiered royalties with a maximum rate of 2%, decreasing to 1.75%, and 1.5% in certain circumstances,

on net sales of licensed products covered under the License Agreement.

Relmada will also pay Licensor tiered payments up to a maximum

of 20%, and decreasing to 17.5%, and 15% in certain circumstances, of all consideration received by Relmada for sublicenses granted

under the License Agreement.

time to time, the Company may become involved in lawsuits and other legal proceedings that arise in the course of business.

is subject to inherent uncertainties, and it is not possible to predict the outcome of litigation with total confidence.

is currently not aware of any legal proceedings or potential claims against it whose outcome would be likely, individually or

in the aggregate, to have a material adverse effect on the Company’s business, financial condition, operating results, or

Brought by Former Officer

February 6, 2019, the Company entered into a settlement agreement in its previous dispute with Najib Babul, Relmada’s former

Babul relinquished his 303,392 shares in Relmada, signed a consulting contract and Relmada committed to a $500,000

initial payment and four subsequent payments of $250,000 on March 31, 2019, June 30, 2019, September 30, 2019 and December 31,

The Company recorded a loss on the settlement of $1.1 million in the first quarter of 2019.

Therapeutics, Inc.

to Unaudited Consolidated Financial Statements

9 - COMMITMENTS AND CONTINGENCIES (continued)

Pursuant to the Agreements, Relmada assigned its existing rights, including patents and patent applications, to d-methadone in

the context of psychiatric use (the Existing Invention) to Licensor.

Licensor then granted Relmada under the License Agreement

a perpetual, worldwide, and exclusive license to commercialize the Existing Invention and certain further inventions regarding

In consideration of the rights granted to Relmada under the License Agreement, Relmada paid the Licensor an upfront,

non-refundable license fee of $180,000.

Additionally, Relmada will pay Licensor $45,000 every three months until the earliest to

occur of the following events:

(i) the first commercial sale of a licensed product anywhere in the world, (ii) the expiration or

invalidation of the last to expire or be invalidated of the patent rights anywhere in the world, or (iii) the termination of the

License Agreement.

Relmada will also pay Licensor tiered royalties with a maximum rate of 2%, decreasing to 1.75%, and 1.5% in

certain circumstances, on net sales of licensed products covered under the License Agreement.

Relmada will also pay Licensor tiered

payments up to a maximum of 20%, and decreasing to 17.5%, and 15% in certain circumstances, of all consideration received by Relmada

for sublicenses granted under the License Agreement.

From time to time, the Company may become

involved in lawsuits and other legal proceedings that arise in the course of business.

Litigation is subject to inherent uncertainties,

and it is not possible to predict the outcome of litigation with total confidence.

The Company is currently not aware of any legal

proceedings or potential claims against it whose outcome would be likely, individually or in the aggregate, to have a material

adverse effect on the Company’s business, financial condition, operating results, or cash flows.

Lawsuit Brought by Former Officer

On February 6, 2019, the Company entered

into a settlement agreement in its previous dispute with Najib Babul, Relmada’s former President.

Babul relinquished his

303,392 shares in Relmada, signed a consulting contract and Relmada committed to a $500,000 initial payment and four subsequent

payments of $250,000 on March 31, 2019, June 30, 2019, September 30, 2019 and December 31, 2019.

The Company recorded a loss on

the settlement of $1.1 million in the first quarter of 2019.

July 15, 2020, an employee of the Company filed a Complaint alleging unequal pay based on gender and other employment based claims.

The Company intends to defend the lawsuit vigorously and does not expect that the lawsuit will have a material effect on its financial

Relmada Therapeutics, Inc.

Notes to Unaudited Consolidated Financial

NOTE 9 - COMMITMENTS AND CONTINGENCIES (continued)

Leases and Sublease

The Company’s corporate headquarters

3 unchanged sentences

The monthly rent is approximately $13,800.

For the six months ended June 30, 2020 and 2019, the Company recognized lease

expense of approximately $83,000 and $46,800, respectively.

On June 8, 2017, the Company entered into an

Amended and Restated License Agreement with Actinium.

For the nine months ended September 30, 2020 and 2019, the Company recognized

lease expense of approximately $124,400 and $70,300, respectively.

On June 8, 2017, the Company entered into

an Amended and Restated License Agreement with Actinium.

Pursuant to the terms of the agreement, Actinium will continue to license

7 unchanged sentences

rate of 8.38% and recognized loss on sales-type lease of fixed assets of $96,403.

For the six months ended June 30, 2020 and 2019,

the Company recognized lease income of approximately $9,400 and $12,300, respectively.

As of June 30, 2020, the balance of unearned

interest income was approximately $22,700.

following tables sets forth our contractual obligations for the next five years and thereafter:

For the nine months ended September 30, 2020

and 2019, the Company recognized lease income of approximately $13,500 and $17,900, respectively.

As of September 30, 2020, the

balance of unearned interest income was approximately $18,600.

Contractual Obligations

The following tables sets forth our contractual

obligations for the next five years and thereafter:

Total obligations

10 - SUBSEQUENT EVENTS

Subsequent to June 30,

2020, 172,093 outstanding warrants were exercised for total cash proceeds of approximately $1,230,000.

These warrant exercises

include 481 shares issued with a cashless exercise.

15, 2020, an employee of the Company filed a Complaint alleging unequal pay based on gender and other employment based claims.

The Company intends to defend the lawsuit vigorously and does not expect that the lawsuit will have a material effect on its financial

On July 22, 2020, the Company awarded a

total of 100,000 options to two new employees with an exercise price of $41.70 and a 10-year term vesting over a 4-year period.

MANAGEMENT’S

DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

FORWARD-LOOKING

STATEMENT NOTICE

Quarterly Report on Form 10-Q (this Report) contains forward looking statements that involve risks and uncertainties, principally

in the sections entitled “Description of Business,”

NOTE 10 - SUBSEQUENT EVENTS

to September 30, 2020, 52,268 outstanding warrants were exercised for total cash proceeds of approximately $437,100.

On October 25, 2020, the Company awarded

a total of 25,000 options to a new employee with an exercise price of $33.34 and a 10-year term vesting over a four year period.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

FORWARD-LOOKING STATEMENT NOTICE

This Quarterly Report on Form 10-Q (this

Report) contains forward looking statements that involve risks and uncertainties, principally in the sections entitled “Description

of Business,”

“Risk Factors,”

and “Management’s Discussion

and Analysis of Financial Condition and Results of Operations.”

All statements other than statements of historical fact

contained in this Quarterly Report, including statements regarding future events, our future financial performance, business strategy

and plans and objectives of management for future operations, are forward-looking statements.

We have attempted to identify forward-looking

statements by terminology including “anticipates,”

and “Management’s Discussion and Analysis of Financial Condition and

Results of Operations.”

All statements other than statements of historical fact contained in this Quarterly Report, including

statements regarding future events, our future financial performance, business strategy and plans and objectives of management

for future operations, are forward-looking statements.

We have attempted to identify forward-looking statements by terminology

including “anticipates,”

“believes,”

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or “will”

or the negative of these terms or

other comparable terminology.

Although we do not make forward-looking statements unless we believe we have a reasonable basis

for doing so, we cannot guarantee their accuracy.

These statements are only predictions and involve known and unknown risks, uncertainties

and other factors, including the risks outlined under “Risk Factors”

or elsewhere in this Quarterly Report, which

may cause our or our industry’s actual results, levels of activity, performance or achievements expressed or implied by

these forward-looking statements.

Moreover, we operate in a very competitive and rapidly changing environment.

New risks emerge

from time to time and it is not possible for us to predict all risk factors, nor can we address the impact of all factors on our

business or the extent to which any factor, or combination of factors, may cause our actual results to differ materially from

those contained in any forward-looking statements.

All forward-looking statements included in this document are based on information

available to us on the date hereof, and we assume no obligation to update any such forward-looking statements.

should not place undue reliance on any forward-looking statement, each of which applies only as of the date of this Quarterly

Report on Form-10-Q.

Before you invest in our securities, you should be aware that the occurrence of the events described in the

section entitled “Risk Factors”

and elsewhere in this Quarterly Report could negatively affect our business, operating

results, financial condition and stock price.

Except as required by law, we undertake no obligation to update or revise publicly

any of the forward-looking statements after the date of this Quarterly Report on Form-10-Q to conform our statements to actual

results or changed expectations.

or the negative of these terms or other comparable terminology.

Although we do not

make forward-looking statements unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy.

These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks

outlined under “Risk Factors”

or elsewhere in this Quarterly Report, which may cause our or our industry’s actual

results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

operate in a very competitive and rapidly changing environment.

New risks emerge from time to time and it is not possible for us

to predict all risk factors, nor can we address the impact of all factors on our business or the extent to which any factor, or

combination of factors, may cause our actual results to differ materially from those contained in any forward-looking statements.

All forward-looking statements included in this document are based on information available to us on the date hereof, and we assume

no obligation to update any such forward-looking statements.

You should not place undue reliance on

any forward-looking statement, each of which applies only as of the date of this Quarterly Report on Form-10-Q.

Before you invest

in our securities, you should be aware that the occurrence of the events described in the section entitled “Risk Factors”

and elsewhere in this Quarterly Report could negatively affect our business, operating results, financial condition and stock price.

Except as required by law, we undertake no obligation to update or revise publicly any of the forward-looking statements after

the date of this Quarterly Report on Form-10-Q to conform our statements to actual results or changed expectations.

Business Overview

Relmada Therapeutics, Inc.

(Relmada or the

Company, we or us) (a Nevada corporation), is a clinical-stage biotechnology company focused on the development of REL-1017 (d-methadone

dextromethadone), an N-methyl-D-aspartate (NMDA) receptor antagonist.

d-methadone is a new chemical entity (NCE) that potentially

addresses areas of high unmet medical need in the treatment of central nervous system (CNS) diseases and other disorders.

receptors are present in many parts of the central nervous system and play important roles in regulating neuronal activity.

believe that dextromethadone acting as an NMDA receptor antagonist can have potential applications in a number of disease indications

which mitigates risk and offers significant upside.

On October 7, 2019, our application to list

its common stock on the NASDAQ Capital Market was approved.

the Company, we or us) (a Nevada corporation), is a clinical-stage biotechnology company focused on the development of REL-1017

(d-Methadone dextromethadone), an N-methyl-D-aspartate (NMDA) receptor antagonist.

d-Methadone is a new chemical entity (NCE) that

potentially addresses areas of high unmet medical need in the treatment of central nervous system (CNS) diseases and other disorders.

NMDA receptors are present in many parts of

the CNS and play important roles in regulating neuronal activity and promoting synaptic plasticity in brain areas important for

mood, behavioral aspects and cognitive functions such as learning and memory.

Based on these premises, d-methadone could show benefits

in several different CNS indications.

On October 7, 2019, our application to

list its common stock on the NASDAQ Capital Market was approved.

On October 10, 2019, the Company’s common stock began trading

2 unchanged sentences

Market and continues to trade under the symbol “RLMD.”

December 19, 2019, the Board of Directors of the Company approved a change to its end of fiscal year from June 30 to December

The change in fiscal year became effective for the Company’s 2020 fiscal year, which began on January 1, 2020 and will

end December 31, 2020.

Our lead product candidate, d-methadone, is

an NCE being developed as a rapidly acting, sustained effect oral agent for the treatment of depression and other potential indications.

We have previously completed Phase 1 single and multiple ascending dose studies and on October 15, 2019 we reported top-line data

from study REL-1017-202.

This was a double-blind, placebo-controlled Phase 2 clinical trial evaluating the safety, tolerability

and efficacy of two oral doses of REL-1017, 25 mg once a day and 50 mg once a day, as an adjunctive treatment in patients with

major depressive disorder (MDD), who experienced an inadequate response to 1 to 3 treatments with an antidepressant medications.

In the REL-1017-202 study, 62 subjects, average

age 49.2 years, with an average Hamilton Depression Rating Scale score of 25.3 and an average Montgomery-Asberg Depression Rating

Scale (MADRS) score of 34.0 (severe depression), were randomized.

On December 19, 2019, the Board of Directors

of the Company approved a change to its end of fiscal year from June 30 to December 31.

The change in fiscal year became effective

for the Company’s 2020 fiscal year, which began on January 1, 2020 and will end December 31, 2020.

Our lead product candidate,

d-methadone, is an NCE in development as a rapidly acting, sustained effect oral agent for the treatment of depression and

other potential indications.

We have previously successfully completed Phase 1 single and multiple ascending dose studies

with safety and tolerability supporting further development.

On October 15, 2019 we reported top-line data from the proof of

concept study REL-1017-202.

This was a double-blind, placebo-controlled Phase 2 clinical trial evaluating the safety,

tolerability and efficacy of two oral doses of REL-1017, 25 mg once a day and 50 mg once a day, as an adjunctive treatment in

patients with major depressive disorder (MDD), who experienced an inadequate response to 1 to 3 treatments with an

antidepressant medications.

In the REL-1017-202 study, 62 subjects,

average age 49.2 years, with an average Hamilton Depression Rating Scale score of 25.3 and an average Montgomery-Asberg Depression

Rating Scale (MADRS) score of 34.0 (severe depression), were randomized.

Demographic characteristics were balanced across all arms.

an initial screening period, subjects were randomized to one of three arms:

placebo, REL-1017 25 mg or REL-1017 50 mg, in addition

to stable background antidepressant therapy.

Subjects in the REL-1017 treatment arms received one loading dose of either 75 mg

(25 mg arm) or 100 mg (50 mg arm) of REL-1017.

After an initial screening period, subjects were randomized to one of three arms:

placebo, REL-1017 25 mg or REL-1017 50 mg, in

addition to stable background antidepressant therapy.

Subjects in the REL-1017 treatment arms received one loading dose of either

75 mg (25 mg arm) or 100 mg (50 mg arm) of REL-1017.

Subjects were treated as inpatients for 7 days and discharged home at Day

returned for follow-up visits at Day 14 and Day 21.

Efficacy was measured on Days 2, 4 and 7 in the dosing period and on Day 14,

one week after treatment discontinuation.

61 subjects received all treatment doses and were included in the per-protocol population

(PPP) treatment analysis;

They returned for follow-up visits at Day 14 and Day 21.

Efficacy was measured on Days 2, 4 and 7 in the dosing period and on

Day 14, one week after treatment discontinuation.

61 subjects received all treatment doses and were included in the per-protocol

population (PPP) treatment analysis;

57 subjects completed all visits.

All 62 randomized subjects were part of the intention-to-treat (ITT)

All 62 randomized subjects were part of the intention-to-treat

(ITT) analysis.

No differences were observed between the ITT and PPP analyses and results.

observed that subjects in both the REL-1017 25 mg and 50 mg treatment groups experienced statistically significant improvement

on all efficacy measures tested as compared to subjects in the placebo group, including:

the Montgomery-Asberg Depression Rating

Scale (MADRS);

the Clinical Global Impression –

Key findings:

We observed that subjects in both the REL-1017

25 mg and 50 mg treatment groups experienced statistically significant improvement on all efficacy measures tested as compared

to subjects in the placebo group, including:

the Montgomery-Asberg Depression Rating Scale (MADRS);

the Clinical Global Impression

Severity (CGI-S) scale;

the Clinical Global Impression –

(CGI-I) scale;

and the Symptoms of Depression Questionnaire (SDQ).

on the MADRS endpoint appeared on Day 4 in both REL-1017 dose groups and continued through Day 7 and Day 14, seven days after

treatment discontinuation, with P values< 0.03 and large effect sizes (a measure of quantifying the difference between two

groups), ranging from 0.7 to 1.0.

Improvement (CGI-I) scale;

and the Symptoms of Depression

Questionnaire (SDQ).

Statistically significant improvements on the MADRS endpoint

appeared on Day 4 in both REL-1017 dose groups and continued through Day 7 and Day 14, seven days after treatment discontinuation,

with P values< 0.03 and large effect sizes (a measure of quantifying the difference between two groups), ranging from 0.7 to

Similar findings emerged from the CGI-S and CGI-I scales.

Analysis of Change from Baseline to Day 7 and to Day 14 ITT Population

Means Difference

LS Means Difference

Means Difference

Analysis of Change from Baseline

to Day 7 and to Day 14 ITT Population

REL-1017 25mg vs Placebo

REL-1017 50mg vs Placebo

= Least Squares;

d = Cohen’s effect size

study also confirmed the favorable tolerability profile of REL-1017, which was also observed in the Phase 1 studies.

experienced mild and moderate adverse events (AEs), and no serious adverse events, without significant differences between placebo

and treatment groups.

The AEs observed in the Phase 2a clinical study were of the same nature as those observed in the Phase 1

clinical studies in d-Methadone, and there was no evidence of either treatment induced psychotomimetic and dissociative AEs or

withdrawal signs and symptoms upon treatment discontinuation.

Upcoming Anticipated Milestones

expect multiple key milestones over the next 12 months.

LS = Least Squares;

d = Cohen’s effect

The study also confirmed the favorable tolerability profile

of REL-1017, which was observed in the Phase 1 studies.

Subjects experienced only mild and moderate adverse events (AEs), and no

serious adverse events, without significant differences between placebo and treatment groups.

The AEs observed in the Phase 2a

clinical study were of the same nature as those observed in the Phase 1 clinical studies in d-methadone, and there was no evidence

of either treatment induced psychotomimetic and dissociative AEs or withdrawal signs and symptoms upon treatment discontinuation.

Key Upcoming Anticipated Milestones

We expect multiple key milestones over

the next 12 months.

These include:

of full details of the Phase 2 data for REL-1017.

of pivotal studies for REL-1017 as an adjunctive treatment of MDD in the second half of 2020.

of Phase 2 study in MDD.

We plan to start a Phase 2 MDD study in the second half of 2020, though development plans may change

based on the FDA’s feedback and other factors.

receptors are present in many parts of the CNS and play important roles in regulating neuronal activity and promoting synaptic

plasticity in brain areas important for cognitive functions such as executive function, learning and memory.

Based on these premises,

d-methadone could show benefits in several different CNS indications.

Phase 1 Clinical Safety Studies

safety data from two Company-funded d-methadone Phase 1 clinical safety studies and a third study conducted by researchers at

Memorial Sloan-Kettering Cancer Center indicate that d-methadone was well tolerated in both healthy subjects and cancer patients

at all projected therapeutic doses tested.

Corporate History and Background

are a clinical-stage, publicly traded biotechnology company developing NCEs and novel versions of proven drug products that potentially

address areas of high unmet medical need in the treatment of depression and other CNS diseases.

none of our product candidates have been approved for sale in the United States or elsewhere.

We have no commercial products nor

do we have a sales or marketing infrastructure.

In order to market and sell our products we must conduct clinical trials on patients

and obtain regulatory approvals from appropriate regulatory agencies, like the FDA in the United States, and similar organizations

elsewhere in the world.

We have not generated revenues and do not

anticipate generating revenues for the foreseeable future.

We had net loss of $21,791,757 for the six months ended June 30, 2020.

At June 30, 2020, we have an accumulated deficit of $141,650,666.

Start of first pivotal Phase III

adjunctive MDD trial

Start of second pivotal Phase

III adjunctive MDD trial

Start of Phase II monotherapy

Results of human abuse potential

Results of Phase II monotherapy

Results of Phase III adjunctive

NMDA receptors are present in many parts

of the CNS and play important roles in regulating neuronal activity and promoting synaptic plasticity in brain areas important

for cognitive functions such as executive function, learning and memory.

Based on these premises, d-methadone could show benefits

in several different CNS indications.

d-Methadone Phase 1 Clinical Safety Studies

The safety data from two Company-funded

d-methadone Phase 1 clinical safety studies and a third study conducted by researchers at Memorial Sloan-Kettering Cancer Center

indicate that d-methadone was well tolerated in both healthy subjects and cancer patients at all projected therapeutic doses tested.

Our Corporate History and Background

We are a clinical-stage, publicly traded biotechnology company

developing NCEs that potentially address areas of high unmet medical need in the treatment of depression and other CNS diseases.

Currently, none of our product candidates

have been approved for sale in the United States or elsewhere.

We have no commercial products nor do we have a sales or marketing

infrastructure.

In order to market and sell our products we must conduct clinical trials on patients and obtain regulatory approvals

from appropriate regulatory agencies, like the FDA in the United States, and similar organizations elsewhere in the world.

We have not generated revenues and do

not anticipate generating revenues for the foreseeable future.

We had net loss of $38,694,264 for the nine months ended September

At September 30, 2020, we have an accumulated deficit of $158,553,173.

Business Strategy

Our strategy is to leverage our considerable

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industry and regulatory experience to lead and execute the development and commercialization of REL-1017.

We plan to further develop REL-1017 as our

priority program.

As the drug d-methadone is an NCE, the regulatory pathway required to support and NDA submission will consist

of conducting a full clinical development program.

We plan to also generate intellectual property (IP) that will further protect

our products from competition.

We will continue to prioritize our product development activities after taking into account the

resources we have available, market dynamics and potential for adding value.

We plan to further develop REL-1017 as our priority program.

As the drug d-methadone is an NCE, the regulatory pathway required to support and NDA submission will consist of conducting a full

clinical development program.

We plan to continue to generate intellectual property (IP) that will further protect our products

from competition.

We will also continue to prioritize our product development activities after taking into account the resources

we have available, market dynamics and potential for adding value.

Market Opportunity

We believe that the market for addressing areas

of high unmet medical need in the treatment of CNS diseases will continue to be large for the foreseeable future and that it will

represent a sizable revenue opportunity for us.

For example, the World Health Organization (WHO) has estimated that CNS diseases

affect nearly 2 billion people globally, making up approximately 40% of total disease burden (based on disability adjusted life

years), compared with 13% for cancer and 12% for cardiovascular disease.

We believe that the market for addressing

areas of high unmet medical need in the treatment of CNS diseases will continue to be large for the foreseeable future and that

it will represent a sizable revenue opportunity for us.

For example, the World Health Organization (WHO) has estimated that CNS

diseases affect nearly 2 billion people globally, making up approximately 40% of total disease burden (based on disability adjusted

life years), compared with 13% for cancer and 12% for cardiovascular disease.

The depression treatment market is segmented

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(Johnson & Johnson).

Intellectual Property Portfolio and Market

over 50 issued patents and pending patent applications related to REL-1017 for multiple uses, including psychological and neurological

We have also secured an Orphan Drug Designation from the FDA for d-methadone for “the treatment of postherpetic

neuralgia”, which, if pursed and upon potential NDA approval, would carry 7-year FDA Orphan Drug marketing exclusivity.

the European Union, some of our products may be eligible up to 10 years of market exclusivity, which includes 8 years data exclusivity

and 2 years market exclusivity.

In addition to any granted patents, REL-1017 will be eligible for market exclusivity to run concurrently

with the term of the patent for 5 years in the U.S.

(Hatch Waxman plus pediatric exclusivity) and up to 10 years of in the E.U.

We believe an extensive intellectual property estate of US and foreign patents and applications, once approved, will protect our

technology and products.

Intellectual Property Portfolio and

Market Exclusivity

have over 50 issued patents and pending patent applications related to REL-1017 for multiple uses, including psychological and

neurological conditions.

We have also secured an Orphan Drug Designation from the FDA for d-methadone for “the treatment

of postherpetic neuralgia”, which, if pursed and upon potential NDA approval, would carry 7-year FDA Orphan Drug marketing

In the European Union, some of our products may be eligible up to 10 years of market exclusivity, which includes

8 years data exclusivity and 2 years market exclusivity.

In addition to any granted patents, REL-1017 will be eligible for market

exclusivity to run concurrently with the term of the patent for 5 years in the U.S.

(Hatch Waxman) plus additional 6 months of

pediatric exclusivity and up to 10 years of in the E.U.

We believe an extensive intellectual property estate of US and foreign

patents and applications, once approved, will protect our technology and products.

Key Strengths

We believe that the key elements for our market success include:

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Potential in multiple indications in underserved markets with large patient population, such as MDD, other affective disorders, and cognitive disorders.

Scientific support of leading experts:

Our scientific advisors include clinicians and scientists who are affiliated with a number of highly regarded medical institutions such as Harvard, Cornell, Yale, and University of Pennsylvania.

Scientific support

of leading experts:

Our scientific advisors include clinicians and scientists who are affiliated with a number of highly regarded

medical institutions such as Harvard, Cornell, Yale, and University of Miami.

Substantial IP portfolio and market protection:

approved and filed patent applications provide coverage beyond 2030.

we file with the Securities and Exchange Commission (SEC) pursuant to the Exchange Act of 1934, as amended (the Exchange Act),

including annual and quarterly reports, and other reports we file, can be inspected and copied at the public reference facilities

maintained by the SEC at 100 F Street NE, Washington, D.C.

A vailable Information

Reports we file with the Securities and

Exchange Commission (SEC) pursuant to the Exchange Act of 1934, as amended (the Exchange Act), including annual and quarterly reports,

and other reports we file, can be inspected and copied at the public reference facilities maintained by the SEC at 100 F Street

NE, Washington, D.C.

Reverse Stock Split

On September 26, 2019, our Board of Directors

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restated to reflect this reverse stock split.

of Operations

the Three Months Ended June 30, 2020 versus June 30, 2019

and development

and administrative

Results of Operations

For the Three Months Ended September 30, 2020 versus September

September 30,

Operating Expenses

Research and development

General and administrative

Research and Development Expense

Research and development expense for the three months ended

June 30, 2020 was approximately $ 5,323,900 compared to $ 3,069,900 for the three months ended June 30, 2019, an increase of approximately

The increase was driven by an increase in study costs of $431,900, of which the majority pertained to completion of

our Phase 2 study and manufacturing costs, as well as an increase in compensation costs of $1,822,200 as a result of hiring 4 additional

research and development employees and the related options granted to them.

and Administrative Expense

General and administrative expense for the three months ended

June 30, 2020 was approximately $7,433,200 compared to $1,065,800 for the three months ended June 30, 2019, an increase of approximately

The increase resulted from an increase in compensation costs of $484,700 as a result of hiring an additional employee;

an increase in stock-based compensation costs of $5,673,200 primarily related to warrant expenses from consultants of approximately

a net increase in other G&A expenses of $209,500 that pertained primarily to investor relations.

Income (Expense)

Interest / investment income was approximately $404,000 and

$13,100 for the three months ended June 30, 2020 and 2019, respectively.

Unrealized gain on short-term investments was approximately

$1,221,900 for the three months ended June 30, 2020.

Realized gain on short-term investments was approximately $12,800 for the

three months ended June 30, 2020.

All investments were classified as cash equivalents at June 30, 2019.

There was no unrealized

gain or loss or realized gain or loss at June 30, 2019.

Research and development expense for

the three months ended September 30, 2020 was approximately $11,237,200 compared to $1,887,400 for the three months ended

September 30, 2019, an increase of approximately $9,349,800.

The increase was driven by an increase in development costs of

$7,511,400, of which the majority pertained to cost associated with toxicology, and in vitro metabolic studies along with the

preparation of the Phase 3 program, as well as an increase in compensation costs of $1,838,400 as a result of hiring four

additional research and development employees and the related options granted to them.

General and Administrative Expense

General and administrative expense for

the three months ended September 30, 2020 was approximately $5,946,400 compared to $1,820,000 for the three months ended September

30, 2019, an increase of approximately $4,126,400.

The increase resulted from an increase in compensation costs of $552,400 as

a result of hiring four additional employees;

an increase in stock-based compensation costs of $3,047,200 primarily related to options

granted to employees during 2020;

a net increase in other G&A expenses of $526,800 that pertained primarily to insurance expense

and state and city franchise taxes.

Other Income (Expense)

Interest / investment income was approximately

$363,300 and $37,900 for the three months ended September 30, 2020 and 2019, respectively.

Unrealized gain on short-term investments

was approximately $3,946 for the three months ended September 30, 2020.

Realized loss on short-term investments was approximately

$86,171 for the three months ended September 30, 2020.

All investments were classified as cash equivalents at September 30, 2019.

There was no unrealized gain or loss or realized gain or loss at September 30, 2019.

The Company did not provide for income

taxes for the three months ended September 30, 2020 and 2019, since there was a loss and a full valuation allowance against all

deferred tax assets.

The net loss for the Company for the three

months ended June 30, 2020 and 2019 was approximately $11,118,400 and $4,122,600, respectively.

months ended September 30, 2020 and 2019 was approximately $16,902,500 and $3,669,500 respectively.

The Company had loss per share,

of basic and diluted $0.73 and $0.50 for the three months ended June 30, 2020 and 2019, respectively.

Company did not provide for income taxes for the three months ended June 30, 2020 and 2019, since there was a loss and a full

valuation allowance against all deferred tax assets.

of Operations

the Six Months Ended June 30, 2020 versus June 30, 2019

basic and diluted of $1.05 and $0.38 for the three months ended September 30, 2020 and 2019, respectively.

For the Nine Months Ended September 30, 2020 versus September

September 30,

Operating Expenses

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Research and Development Expense

Research and development expense for the six months ended June

30, 2020 was approximately $9,831,700 compared to $4,345,800 for the six months ended June 30, 2019, an increase of approximately

The increase was driven by an increase in study costs of $1,298,700, of which the majority pertained to completion

of our Phase 2 study and manufacturing costs, as well as an increase in compensation costs of $4,187,200 which included the approximately

$2,936,100 of stock based compensation expense primarily related to the separation agreement with Ottavio Vitolo, the remaining

increase was a result of hiring 4 additional research and development employees and the related options granted to them.

Research and development expense for the nine months ended September

30, 2020 was approximately $21,068,900 compared to $6,233,200 for the nine months ended September 30, 2019, an increase of approximately

The increase was driven by an increase in development costs of $8,810,000, of which the majority pertained to completion

of our Phase 2 study, costs associated with the toxicology, and in vitro metabolic studies along with the preparation of the Phase

3 program, as well as an increase in compensation costs of $6,025,700 which included the approximately $4,375,900 of stock based

compensation expense related to the hiring of four additional research and development employees and the related options granted

to them, and the separation agreement with Ottavio Vitolo.

General and Administrative Expense

General and administrative expense for the six months ended

June 30, 2020 was approximately $12,899,900 compared to $2,491,900 for the six months ended June 30, 2019, an increase of approximately

The increase resulted from an increase in compensation costs of $1,442,100, as a result of hiring additional employees

and their related bonuses;

an increase in stock-based compensation costs of $8,607,600 related to warrant expenses from consultants

of approximately $2,500,000;

a net increase in other G&A expenses of $358,300 that pertained primarily to investor relations

and professional fees.

General and administrative expense for

the nine months ended September 30, 2020 was approximately $18,846,300 compared to $4,311,900 for the nine months ended September

30, 2019, an increase of approximately $14,534,400.

The increase resulted from an increase in compensation costs of $1,981,400,

as a result of hiring four additional employees and their related bonuses;

an increase in stock-based compensation costs of $11,654,800

primarily related to options granted to employees during 2020;

a net increase in other G&A expenses of $898,200 that pertained

primarily to insurance expense and state and city tax expense.

Other Income (Expense)

Interest / investment income was approximately

$811,700 and $29,000 for the six months ended June 30, 2020 and 2019, respectively.

Unrealized gain on short-term investments was

approximately $287,000 for the six months ended June 30, 2020.

$1,175,000 and $67,000 for the nine months ended September 30, 2020 and 2019, respectively.

Unrealized gain on short-term investments

was approximately $291,000 for the nine months ended September 30, 2020.

Realized loss on short-term investments was approximately

for the six months ended June 30, 2020.

All investments were classified as cash equivalents at June 30, 2019.

There was no unrealized

gain or loss or realized gain or loss at June 30, 2019.

The net loss for the Company for the six

months ended June 30, 2020 and 2019 was approximately $21,791,800 and $6,808,700 respectively.

$245,000 for the nine months ended September 30, 2020.

All investments were classified as cash equivalents at September 30, 2019.

There was no unrealized gain or loss or realized gain or loss at September 30, 2019.

The Company did not provide for income

taxes for the nine months ended September 30, 2020 and 2019, since there was a loss and a full valuation allowance against all

deferred tax assets.

The net loss for the Company for the nine

months ended September 30, 2020 and 2019 was approximately $38,694,300 and $10,478,200 respectively.

The Company had loss per share,

of basic and diluted $1.45 and $0.86 for the six months ended June 30, 2020 and 2019, respectively.

Company did not provide for income taxes for the six months ended June 30, 2020 and 2019, since there was a loss and a full valuation

allowance against all deferred tax assets.

As shown in the accompanying financial statements,

the Company incurred negative operating cash flows of approximately $8,378,400 for the six months ended June 30, 2020 and has an

accumulated deficit of approximately $141,650,700 from inception through June 30, 2020.

At June 30, 2020 the Company had cash and

short term investments of approximately $134,087,800.

Relmada has funded its past operations through equity raises

and most recently in 2020 raised net proceeds from the sale of common stock of $19,855,018 through our ATM offering and $5,619,276

through the exercise of warrants.

The Company also raised an additional $530,643 during the six months ended June 30, 2020 from

the exercises of options.

Management believes that

due to the recent equity raises completed and exercises of outstanding warrants and the current cash position on its balance sheet,

it has obtained sufficient funding to continue ongoing operations for the at least 12 months from the issuance of the accompanying

consolidated quarterly financial statements.

Since June 30, 2020 and to date, the Company has received approximately $1,230,000

in warrant exercises, which resulted in the Company having approximately $131,549,600 million in cash, cash equivalents and short

term investments at August 5, 2020.

Based on its budgeted cash flow requirements, the Company believes these funds are sufficient

to fund its ongoing operations for at least 12 months after the issuance of these consolidated quarterly financial statements.

following table sets forth selected cash flow information for the periods indicated below:

Six Months Ended

basic and diluted of $2.52 and $1.23 for the nine months ended September 30, 2020 and 2019, respectively.

As shown in the accompanying financial

statements, the Company incurred negative operating cash flows of $20,880,039 for the nine months ended September 30, 2020 and

has an accumulated deficit of $158,553,173 from inception through September 30, 2020.

At September 30, 2020 the Company had cash

and short term investments of $123,138,478.

Relmada has funded its past operations

through equity raises and most recently in 2020 raised net proceeds from the sale of common stock of $19,816,597, and $7,186,306 through the exercise of warrants.

The Company also raised an additional $636,518 during the nine months

ended September 30, 2020 from the exercises of options.

believes that due to the recent equity raises completed and exercises of outstanding warrants and the current cash position on

its balance sheet, it has obtained sufficient funding to continue ongoing operations for at least 12 months from the issuance of

the accompanying consolidated quarterly financial statements.

Since September 30, 2020 and to date, the Company has received approximately

$437,100 in warrant exercises, which resulted in the Company having approximately $121.5 million in cash, cash equivalents and

short term investments at November 9, 2020.

Based on its budgeted cash flow requirements, the Company believes these funds are

sufficient to fund its ongoing operations for at least 12 months after the issuance of these consolidated quarterly financial statements.

The following table sets forth selected cash flow information

for the periods indicated below:

Nine Months Ended

September 30,

Nine Months Ended

September 30,

Cash used in operating activities

$ (20,880,039 )

$ (8,213,160 )

Cash used in investing activities

(35,382,926 )

Cash provided by financing activities

Net decrease in cash and cash equivalents

For the six months ended June 30, 2020, cash used in operating

activities was $8,378,419 primarily due to the net loss of $21,791,757, offset by non-cash stock compensation charges of $12,341,875,

prepaid expense of $183,329, accounts payable of $442,506, unrealized gain of $287,027, realized loss of $158,801, and accrued

expenses of $535,997.

For the six months ended June 30, 2019,

cash used in operating activities was $5,679,009 primarily due to the loss from operations for the six months ended June 30, 2019

of $6,808,657 off set by accounts payable of $565,469 prepaid expense of $381,124, and non-cash stock compensation expense of

$798,151, offset by accrued expenses of $72,692 and shares relinquished in litigation of $394,410.

For the six months ended June 30, 2020, cash

used in investing activities was $39,970,532 related to the net purchase and sale of short-term investments.

For the six months

ended June 30, 2020, no cash was used in investing activities.

Net cash provided by financing activities for

the six months ended June 30, 2020 was $25,894,690 due to proceeds from options exercised for common stock of $530,643, proceeds

from warrants exercised for common stock of $5,619,276, and sales of common stock of $19,855,018, partially offset by payments

of notes payable of $110,247.

Net cash provided by financing activities for the six months ended June 30, 2019 was $12,468,812

primarily due to proceeds from the sale of common stock of $12,583,550 partially offset by payments of notes payable of $114,738.

assets are primarily monetary, consisting of cash and cash equivalents.

Because of their liquidity, these assets are not directly

affected by inflation.

Because we intend to retain and continue to use our equipment, we believe that the incremental inflation

related to replacement costs of such items will not materially affect our operations.

However, the rate of inflation affects our

expenses, such as those for employee compensation and contract services, which could increase our level of expenses and the rate

at which we use our resources.

Sheet Arrangements

part of our ongoing business, we do not participate in transactions that generate relationships with unconsolidated entities or

financial partnerships, such as entities often referred to as structured finance or special purpose entities (SPEs), which would

have been established for the purpose of facilitating off-balance sheet arrangements or other contractually limited purposes.

As of June 30, 2020 and December 31, 2019, we were not involved in any SPE transactions.

and Contingencies

refer to Note 12 in our Annual Report on Form 10-KT for the six months ended December 31, 2019 under the heading Commitments and

Contingencies.

To our knowledge there have been no material changes to the risk factors that were previously disclosed in the

Company’s Annual Report on Form 10-KT for the six months ended December 31, 2019.

Additional risks and uncertainties

not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial

condition and/or operating results.

Accounting Policies and Estimates

critical accounting policy is one that is both important to the portrayal of a company’s financial condition and results

of operations and requires management’s most difficult, subjective or complex judgments, often as a result of the need to

make estimates about the effect of matters that are inherently uncertain.

unaudited consolidated financial statements are presented in accordance with U.S.

$ (28,733,791 )

For the nine months ended September 30,

2020, cash used in operating activities was $20,880,039 primarily due to the net loss of $38,694,264, partially offset by non-cash

stock compensation charges of $17,586,533, an increase in prepaid expense of $1,825,336, an unrealized gain of $290,973, an increase

in accounts payable of $205,970, a realized loss of $244,972, and an increase in accrued expenses of $1,835,888.

For the nine months ended September 30,

2019, cash used in operating activities was $8,213,160 primarily due to the loss from operations for the nine months ended September

30, 2019 of $10,478,151, partially offset by non-cash stock compensation charges of 1,555,867, a decrease in prepaids of $524,967,

an increase in accounts payable of $907,657, and a decrease in accrued expenses of $376,157 and shares relinquished in litigation

For the nine months ended September 30,

2020, cash used in investing activities was $35,382,926 related to the net purchase of short-term investments.

For the nine months

ended September 30, 2019, no cash was used in investing activities.

Net cash provided by financing activities

for the nine months ended September 30, 2020 was $27,529,174 due to sales of common stock of $19,816,597, proceeds from warrants

exercised for common stock of $7,186,306, and proceeds from options exercised for common stock of $636,518, partially offset by

payments of notes payable of $110,247.

Net cash provided by financing activities

for the nine months ended September 30, 2019 was $13,636,282 due to sales of common stock of $13,409,299 and proceeds from warrants

exercised for common stock of $450,000, partially offset by payments of notes payable of $223,017.

Effects of Inflation

Our assets are primarily monetary, consisting

of cash and cash equivalents.

Because of their liquidity, these assets are not directly affected by inflation.

Because we intend

to retain and continue to use our equipment, we believe that the incremental inflation related to replacement costs of such items

will not materially affect our operations.

However, the rate of inflation affects our expenses, such as those for employee compensation

and contract services, which could increase our level of expenses and the rate at which we use our resources.

Off-Balance Sheet Arrangements

As part of our ongoing business, we do

not participate in transactions that generate relationships with unconsolidated entities or financial partnerships, such as entities

often referred to as structured finance or special purpose entities (SPEs), which would have been established for the purpose of

facilitating off-balance sheet arrangements or other contractually limited purposes.

As of September 30, 2020 and December 31,

2019, we were not involved in any SPE transactions.

Commitments and Contingencies

Please refer to Note 12 in our Annual Report

on Form 10-KT for the six months ended December 31, 2019 under the heading Commitments and Contingencies.

To our knowledge there

have been no material changes to the risk factors that were previously disclosed in the Company’s Annual Report on Form 10-KT

for the six months ended December 31, 2019.

Additional risks and uncertainties not currently known to us or that we currently

deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

Critical Accounting Policies and Estimates

A critical accounting policy is one that

is both important to the portrayal of a company’s financial condition and results of operations and requires management’s

most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that

are inherently uncertain.

Our unaudited consolidated financial statements

are presented in accordance with U.S.

GAAP, and all applicable U.S.

GAAP accounting

standards effective as of June 30, 2020 have been taken into consideration in preparing the unaudited consolidated financial statements.

The preparation of unaudited consolidated financial statements requires estimates and assumptions that affect the reported amounts

of assets, liabilities, expenses and related disclosures.

Some of those estimates are subjective and complex, and, consequently,

actual results could differ from those estimates.

The following accounting policies and estimates have been highlighted as significant

because changes to certain judgments and assumptions inherent in these policies could affect our consolidated financial statements:

and development expenses, and

compensation expenses

base our estimates, to the extent possible, on historical experience.

Historical information is modified as appropriate based

on current business factors and various assumptions that we believe are necessary to form a basis for making judgments about the

carrying value of assets and liabilities.

We evaluate our estimates on an on-going basis and make changes when necessary.

results could differ from our estimates.

AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

have been no material changes to our exposures to market risks as disclosed under the heading “Quantitative and Qualitative

Disclosures About Market Risks”

GAAP accounting standards effective as of September 30, 2020

have been taken into consideration in preparing the unaudited consolidated financial statements.

The preparation of unaudited consolidated

financial statements requires estimates and assumptions that affect the reported amounts of assets, liabilities, expenses and related

Some of those estimates are subjective and complex, and, consequently, actual results could differ from those estimates.

The following accounting policies and estimates have been highlighted as significant because changes to certain judgments and assumptions

inherent in these policies could affect our consolidated financial statements:

Research and development expenses, and

Stock-based compensation expenses

We base our estimates, to the extent possible,

on historical experience.

Historical information is modified as appropriate based on current business factors and various assumptions

that we believe are necessary to form a basis for making judgments about the carrying value of assets and liabilities.

our estimates on an on-going basis and make changes when necessary.

Actual results could differ from our estimates.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

There have been no material changes to

our exposures to market risks as disclosed under the heading “Quantitative and Qualitative Disclosures About Market Risks”

in the annual MD&A contained in our Form 10-KT for the six months ended December 31, 2019.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements