RELMADA THERAPEUTICS, INC. 10-Q

ITEM 1. FINANCIAL STATEMENTS Relmada Therapeutics, Inc. Condensed Consolidated Balance Sheets As of March 31, As of 2025 (Unaudited) December 31, 2024 Assets Current assets: Cash and cash equivalents $ 1,149,706 $ 3,857,026 Short-term investments 25,911,326 41,052,356 Prepaid expenses 596,410 886,461 Total current assets 27,657,442 45,795,843 Other assets 21,975 21,975 Total assets $ 27,679,417 $ 45,817,818 Commitments and Contingencies (See Note 8) Liabilities and Stockholders’ Equity Current liabilities: Accounts payable $ 1,265,010 $ 4,130,563 Accrued expenses 3,966,411 6,160,827 Total current liabilities 5,231,421 10,291,390 Stock appreciation rights 7,505 4,467 Total liabilities 5,238,926 10,295,857 Stockholders’ Equity: Preferred stock, $ 0.001 par value, 200,000,000 shares authorized, none issued and outstanding - - Class A convertible preferred stock, $ 0.001 par value, 3,500,000 shares authorized, none issued and outstanding - - Common stock, $ 0.001 par value, 150,000,000 shares authorized, 33,191,622 and 30,174,202 shares issued and outstanding, respectively 33,191 30,174 Additional paid-in capital 680,848,800 676,373,822 Accumulated deficit ( 658,441,500 ) ( 640,882,035 ) Total stockholders’ equity 22,440,491 35,521,961 Total liabilities and stockholders’ equity $ 27,679,417 $ 45,817,818 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 1 Relmada Therapeutics, Inc. Condensed Consolidated Statements of Operations (Unaudited) Three months ended March 31, 2025 2024 Operating expenses: Research and development $ 11,951,023 $ 13,305,306 General and administrative 6,267,412 9,682,554 Total operating expenses 18,218,435 22,987,860 Loss from operations ( 18,218,435 ) ( 22,987,860 ) Other income: Interest/investment income, net 440,287 1,055,888 Realized gain on short-term investments 62,952 53,133 Unrealized gain on short-term investments 155,731 50,713 Total other income 658,970 1,159,734 Net loss $ ( 17,559,465 ) $ ( 21,828,126 ) Loss per common share – basic and diluted $ ( 0.58 ) $ ( 0.72 ) Weighted average number of common shares outstanding – basic and diluted 30,408,890 30,132,170 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 2 Relmada Therapeutics, Inc. Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) Three months ended March 31, 2025 Common Stock Additional Paid-in Accumulated Shares Par Value Capital Deficit Total Balance - December 31, 2024 30,174,202 $ 30,174 $ 676,373,822 $ ( 640,882,035 ) $ 35,521,961 Stock based compensation - - 3,572,769 - 3,572,769 Issuance of Restricted Common Stock 3,017,420 3,017 902,209 - 905,226 Net loss - - - ( 17,559,465 ) ( 17,559,465 ) Balance – March 31, 2025 33,191,622 $ 33,191 $ 680,848,800 $ ( 658,441,500 ) $ 22,440,491 Three months ended March 31, 2024 Common Stock Additional Paid-in Accumulated Shares Par Value Capital Deficit Total Balance - December 31, 2023 30,099,203 $ 30,099 $ 646,229,824 $ ( 560,902,681 ) $ 85,357,242 Stock based compensation - - 8,295,468 - 8,295,468 Options exercised for common stock 74,999 75 246,672 - 246,747 ATM Fees - - ( 25,000 ) - ( 25,000 ) Net loss - - - ( 21,828,126 ) ( 21,828,126 ) Balance - March 31, 2024 30,174,202 $ 30,174 $ 654,746,964 $ ( 582,730,807 ) $ 72,046,331 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 3 Relmada Therapeutics, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) Three months ended March 31, 2025 2024 Cash flows from operating activities Net loss $ ( 17,559,465 ) $ ( 21,828,126 ) Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation 4,477,995 8,295,468 Realized gain on short-term investments ( 62,952 ) ( 53,133 ) Unrealized gain on short-term investments ( 155,731 ) ( 50,713 ) Change in operating assets and liabilities: Prepaid expenses 290,051 432,723 Accounts payable ( 2,865,553 ) 1,683,092 Accrued expenses ( 2,194,416 ) ( 1,516,059 ) Stock appreciation rights compensation 3,038 - Net cash used in operating activities ( 18,067,033 ) ( 13,036,748 ) Cash flows from investing activities Purchase of short-term investments ( 487,916 ) ( 7,013,933 ) Sale of short-term investments 15,847,629 17,072,384 Net cash provided by investing activities 15,359,713 10,058,451 Cash flows from financing activities Proceeds from options exercised for common stock - 246,747 ATM Fees - ( 25,000 ) Net cash provided by financing activities - 221,747 Net decrease in cash and cash equivalents ( 2,707,320 ) ( 2,756,550 ) Cash and cash equivalents at beginning of the period 3,857,026 4,091,568 Cash and cash equivalents at end of the period $ 1,149,706 $ 1,335,018 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 4 Relmada Therapeutics, Inc. Notes to Unaudited Condensed Consolidated Financial Statements NOTE 1 - BUSINESS Relmada Therapeutics, Inc. (Relmada or the Company) (a Nevada corporation), is a clinical-stage, publicly traded biotechnology company focused on the development of NDV-01 and Sepranolone. NDV-01 is a novel, controlled-release intravesical formulation of gemcitabine and docetaxel. NDV-01 is currently in a Phase 2 clinical trial to assess its safety and efficacy in patients with aggressive forms of non-muscle invasive bladder cancer (NMIBC). Sepranolone is a novel neurosteroid epimer of allopregnanolone. Sepranolone is being developed for the potential treatment of Prader-Willi Syndrome, Tourette Syndrome, excessive tremor and other diseases related to excessive GABAergic activity. The Esmethadone (d-methadone, dextromethadone, REL-1017) program has been paused pending a comprehensive data review of the data generated so far. Esmethadone an N-methyl-D-aspartate (NMDA) receptor antagonist. Esmethadone 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. Relmada was also developing a proprietary, modified-release formulation of psilocybin (REL-P11) for metabolic indications. This program was terminated effective May 12, 2025, after a successful P1 study and in light of the adversely changed regulatory environment affecting chronic administration of psylocibin and potentially other psychedelic drugs. 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 Food and Drug Administration (FDA) and other governmental regulations and approval requirements. On January 21, 2025, we received a deficiency letter from the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market advising that, for 30 consecutive business days preceding the notification letter, the Company did not meet the minimum $ 1.00 per share bid price requirement for continued inclusion on The Nasdaq Global Select Market. The deficiency letter does not result in the immediate delisting of our common stock from the Nasdaq Global Select Market. In accordance with Nasdaq Listing Rule 5810(c)(3)(A) (the “Compliance Period Rule”), we have been provided an initial period of 180 calendar days, or until July 21, 2025 (the “Compliance Date”), to regain compliance with the minimum bid price requirement. If, at any time before the Compliance Date, the bid price for our common stock closes at $ 1.00 per share or more for a minimum of 10 consecutive business days, as required by the Compliance Period Rule, the Staff will provide written notification to us that we comply with the minimum bid price requirement, unless the Staff exercises its discretion to extend this 10-day period pursuant to Nasdaq Listing Rule 5810(c)(3)(H). While we intend to regain compliance with the minimum bid price requirement, there can be no assurance that we will be able to maintain continued compliance with this rule or the other listing requirements of The Nasdaq Stock Market. If we were unable to meet these requirements, we would receive another delisting notice from the Nasdaq Stock Market for failure to comply with one or more of the continued listing requirements. If our common stock were to be delisted from The Nasdaq Global Select Market, trading of our common stock most likely will be conducted in the over-the-counter market on an electronic bulletin board established for unlisted securities such as the OTC Markets or in the “pink sheets.” Such a downgrading in our listing market may limit our ability to make a market in our common stock and which may impact purchases or sales of our securities. On February 3, 2025, the Company entered into an Asset Purchase Agreement (the Purchase Agreement) with Asarina Pharma AB (Asarina), a Swedish corporation, pursuant to which the Company has agreed, subject to the terms and conditions set forth therein, to purchase from Asarina all right, title, and interest in Sepranolone, a phase 2b ready neurosteroid being developed for the potential treatment of Prader-Willi Syndrome, Tourette Syndrome, essential tremor and other diseases related to excessive GABAergic activity. The total purchase price for Sepranolone is € 3,000,000 . The Company paid Asarina $ 2,756,000 on February 5, 2025, which includes a credit of $ 250,000 for a previous payment made by the Company to Asarina pursuant to an exclusivity agreement dated October 25, 2024. On March 24, 2025, we entered into an Exclusive License Agreement with Trigone, an Israeli company. The license agreement is for Trigone’s NDV-01 product, which is a novel, sustained-release, intravesical gemcitabine/docetaxel, ready-for-use product candidate for the treatment of NMIBC. Under the terms of the agreement, the Company made a $ 3,500,000 upfront payment on March 25, 2025, and issued 3,017,420 shares of common stock, which represented 10 % of the Company’s outstanding shares on such date, for exclusive worldwide rights to NDV-01, excluding Israel, India and South Africa. In addition, the Company will pay up to approximately $ 200 million in development, regulatory and sales milestones pending successful commercialization. The Company will also pay a royalty of 3 % on any net sales. NOTE 2 - GOING CONCERN These unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying unaudited condensed consolidated financial statements, the Company has incurred losses and negative cash flows from operations since inception and expects to incur additional losses until such time that it can generate significant revenue from the commercialization of its product candidates. During the three months ended March 31, 2025, the Company incurred a net loss of $ 17,559,465 and had negative operating cash flows of $ 18,067,033 . Given the Company’s projected operating requirements and its existing cash and cash equivalents and short-term investments, the Company is projecting insufficient liquidity to sustain its operations through one year following the date that the financial statements are issued. These conditions and events raise substantial doubt about the Company’s ability to continue as a going concern. 5 Relmada Therapeutics, Inc. Notes to Unaudited Condensed Consolidated Financial Statements NOTE 2 - GOING CONCERN (continued) In response to these conditions, management is currently evaluating the size and scope of any subsequent operations and clinical trials that will affect the timing to obtain the required funding of future operations. Financing strategies may include, but are not limited to, the public or private sale of equity or debt securities or from bank or other loans or through strategic collaboration and/or licensing agreements. There can be no assurances that the Company will be able to secure additional financing, or if available, that it will be sufficient to meet its needs or on favorable terms. Because management’s plans have not yet been finalized and are not within the Company’s control, the implementation of such plans cannot be considered probable. As a result, the Company has concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern. The unaudited condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty. NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed 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 condensed consolidated financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete consolidated financial statements. The unaudited condensed 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 condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2024 and notes thereto contained in the Company’s Annual Report on Form 10-K. Principles of Consolidation The unaudited condensed 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. 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 stock-based compensation expenses and recorded amounts related to income taxes. 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 and cash equivalents. The Company’s cash deposits are held at two high-credit-quality financial institutions. The Company’s cash and cash equivalents are carried at cost, which approximates their fair value. The Company’s cash and cash equivalents balance of $ 1,149,706 and $ 3,857,026 at March 31, 2025 and December 31, 2024, respectively, at these institutions exceed the 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”. Substantially all equity investments in nonconsolidated entities are measured at fair value with recurring changes recognized in earnings, except for those accounted for using equity accounting methods. Changes in fair value of the securities are recorded as part of other income on the unaudited condensed consolidated statement of operations. Short-term investment activity is presented in the investing activities section on the condensed consolidated statement of cash flows. Short-term investments at March 31, 2025 and December 31, 2024 consisted of mutual funds with a fair value of $ 25,911,326 and $ 41,052,356 , respectively. Patents 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. Leases 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 leases consists of operating leases for office space for terms of 12 months or less. 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. 6 Relmada Therapeutics, Inc. Notes to Unaudited Condensed Consolidated Financial Statements NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Fair Value of Financial Instruments The Company’s financial instruments primarily include cash, short term investments, and stock appreciation rights. 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 activity). As required by Accounting Standard Codification (ASC) Topic No. 820 - 10 Fair Value Measurement , financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. The Company’s short-term investment instruments of $ 25,911,326 at March 31, 2025 consist of mutual funds and 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 condensed consolidated statement of operations as unrealized gain on short-term investment. The Company recorded unrealized gains of $ 155,731 and $ 50,713 included in other income (expense) for the three months ended March 31, 2025 and 2024, respectively. The Company’s stock appreciation rights liability is a mark-to-market liability and classified within Level 3 of the fair value hierarchy as the Company is using a Black-Scholes option pricing model. Significant unobservable inputs included expected term and volatility. The expected term was calculated using the simplified method. The volatility is calculated based on the Company’s historical stock price over a period of time. As of March 31, 2025, the stock appreciation rights liability had a fair value of $ 7,505 . Significant inputs for Level 3 stock appreciation rights liability fair value measurement at March 31, 2025 are (1) discount rate of 3.96 % - 4.03 %, (2) expected life of 5.50 – 6.00 years, (3) expected volatility of 128 % - 131 %, (4) zero expected dividends, (5) stock price of $ 0.27 and (6) exercise price of $ 0.45 - $ 3.84 . There have been no transfers in and out of level 3 during the three-months ended March 31, 2025. 7 Relmada Therapeutics, Inc. Notes to Unaudited Condensed Consolidated Financial Statements NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Income Taxes 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 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. 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 March 31, 2025 and December 31, 2024, 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 March 31, 2025 and December 31, 2024. The open tax years, subject to potential examination by the applicable taxing authority, for the Company are from December 31, 2020 forward. 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 consultants. The Company expenses all research and development costs in the period incurred. 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. 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. Stock Appreciation Rights Pursuant to the terms of the Company’s 2021 Equity Incentive Plan, the Company may grant cash-settled Stock Appreciation Rights (“SARs”) that are classified as liabilities under ASC 718 ( Compensation—Stock Compensation ). These SARs allow employees to receive cash payments based on the appreciation of the Company’s stock price over a specified period. The initial fair value of SARs is determined on the grant date using the Black-Scholes option pricing model. SARs are remeasured at fair value at each reporting date using the Black-Scholes pricing model until they are exercised or expire. Changes in fair value are recognized in the income statement as a compensation expense. Compensation expense is recognized over the service period, which is the period during which employees are required to provide service in exchange for the award. Upon exercise, the Company will settle SARs in cash based on the difference between the fair value of the underlying shares at the exercise date and the exercise price. 8 Relmada Therapeutics, Inc. Notes to Unaudited Condensed Consolidated Financial Statements NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Net 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 losses in each period. For the three months ended March 31, 2025 and 2024, 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): Three months ended March 31, 2025 March 31, 2024 Stock options 11,258,927 17,013,135 Common stock warrants 872,908 2,235,412 Total 12,131,835 19,248,547 Adoption of Recent Accounting Standards In November 2023, The FASB issued ASU 2023-07, “ Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ” which expands annual and interim disclosures for reportable segments, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 is effective for our annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025, with early adoption permitted. The Company adopted this standard effective January 1, 2024 and the standard did not have significant impact on our consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, “ Income Taxes (Topic 740): Improvements to Income Tax Disclosures ” to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 was effective for our annual periods beginning January 1, 2025. The Company adopted this standard effective January 1, 2025 and the updated standard did not have a significant impact on our consolidated financial statement disclosures. Recent Accounting Standards In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) . ASU 2024-03 requires specified information about certain costs and expenses be disclosed in the notes to the financial statements, including the expense caption on the face of the income statement in which they are disclosed, in addition to a qualitative description of remaining amounts not separately disaggregated. Entities will also be required to disclose their definition of “selling expenses” and the total amount in each annual period. The standard is effective for the Company for annual periods beginning January 1, 2027 and for interim periods beginning January 1, 2028, with updates applied either prospectively or retrospectively. Early adoption is permitted. The Company is currently evaluating the impact of this guidance on its disclosures. 9 Relmada Therapeutics, Inc. Notes to Unaudited Condensed Consolidated Financial Statements NOTE 4 - PREPAID EXPENSES Prepaid expenses consisted of the following (rounded to nearest $00): March 31, 2025 December 31, 2024 Insurance $ 195,000 $ 403,100 Research and Development 265,900 391,200 Other 135,500 92,200 Total $ 596,400 $ 886,500 NOTE 5 - ACCRUED EXPENSES Accrued expenses consisted of the following (rounded to nearest $00): March 31, 2025 December 31, 2024 Research and development $ 2,566,400 $ 4,514,800 Professional fees 313,200 362,600 Accrued bonus 457,300 732,300 Accrued vacation 561,900 421,700 Other 67,600 129,400 Total $ 3,966,400 $ 6,160,800 NOTE 6 - STOCK APPRECIATION RIGHTS During the three months ended March 31, 2025, 300,000 cash-settled stock appreciation rights have been issued to consultants with an exercise price of $ 0.45 with a 10 -year term and vesting over a 4 -year period. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 4.43 %, (2) expected life of 6.25 years, (3) expected volatility of 135 %, and (4) zero expected dividends. At March 31, 2025, the Company revalued the cash-settled stock appreciation rights using a stock price of $ 0.27 and an exercise price of $ 0.45 - $ 3.84 . Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 3.96 % - 4.03 %, (2) expected life of 5.50 – 6.00 years, (3) expected volatility of 128 % - 131 % and (4) zero expected dividends. As of March 31, 2025, the total liability related to cash-settled SARs is $ 7,505 , reflecting the fair value as of the reporting date. During the quarter ended March 31, 2025, the Company recorded compensation related to the cash-settled SARs in the amount of $ 3,038 , included in research and development expenses in the accompanying unaudited condensed consolidated statements of operations. A summary of the changes in SARs during the three months ended March 31, 2025 is as follows: Number of Cash-Settled SARS Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding at December 31, 2024 110,000 $ 0.99 9.58 $ - Granted 300,000 $ 0.33 9.76 $ - Outstanding at March 31, 2025 410,000 $ 1.32 9.65 $ - SARs vested at March 31, 2025 - $ - - $ - At March 31, 2025, the Company has unrecognized compensation expense of approximately $ 82,300 related to unvested stock appreciation rights which will be recognized over the weighted average remaining service period of 3.65 years. 10 Relmada Therapeutics, Inc. Notes to Unaudited Condensed Consolidated Financial Statements NOTE 7 - STOCKHOLDERS’ EQUITY Common Stock During the year ended December 31, 2024, the Company issued 74,999 shares of common stock for the exercise of options for proceeds of $ 246,747 . During the three months ended March 31, 2025, the Company issued 3,017,420 shares of restricted common stock in accordance with the license agreement with Trigone Pharma. The Company recognized $ 905,226 of research and development compensation expense related to the restricted common stock issued as part of the transaction. On April 6, 2022, the Company entered into a new Open Market Sale Agreement with Jefferies, as sales agent, pursuant to which we may offer and sell, from time to time, through Jefferies, shares of our common stock, having an aggregate offering price of up to $ 100,000,000 . We are not obligated to sell any shares under the agreement. As of March 31, 2025, no shares have been issued under this agreement. Options and Warrants In December 2014, the Board of Directors adopted, and the Company’s shareholders approved Relmada’s 2014 Stock Option and Equity Incentive Plan, as amended (the “Plan”), which allows for the granting of 5,152,942 common stock awards, stock appreciation rights, and incentive and nonqualified stock options to purchase shares of the Company’s common stock to designated employees, non-employee directors, and consultants and advisors. In May 2021, the Company’s Board of Directors adopted, and shareholders approved Relmada’s 2021 Equity Incentive Plan (the “2021 Plan”) which allows for the granting of 1,500,000 options or other stock awards. In May 2022, the Company’s Board of Directors adopted, and shareholders approved an amendment to the 2021 Plan to increase the shares of the Company’s common stock available for issuance thereunder by 3,900,000 shares. In May 2023, the Company’s Board of Directors adopted and shareholders approved an amendment to the 2021 Plan to increase the shares of the Company’s common stock available for issuance thereunder by 2,500,000 shares. These combined plans allowed for the granting of up to 13,052,942 options or other stock awards. Stock options are exercisable generally for a period of 10 years from the date of grant and generally vest over four years . The 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. From January 1, 2025 through March 31, 2025, 203,567 options were issued with an exercise price of $ 0.30 and a 10 -year term, vesting over a 4 year period. The options granted include time-based vesting grants. The options have an aggregate fair value of approximately $ 54,963 calculated using the Black-Scholes option-pricing model. Variables used in the Black-Scholes option-pricing model include: (1) discount rate of 4.05 % - 4.16 % (2) expected life of 6.25 years, (3) expected volatility of 126 %, and (4) zero expected dividends. 11 Relmada Therapeutics, Inc. Notes to Unaudited Condensed Consolidated Financial Statements NOTE 7 - STOCKHOLDERS’ EQUITY (continued) Options A summary of the changes in options during the three months ended March 31, 2025 is as follows: Number of Options Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value Outstanding and expected to vest at December 31, 2024 12,263,017 $ 16.61 6.01 $ - Granted 203,567 $ 0.30 - $ Cancelled ( 1,207,657 ) $ 17.34 - $ - Outstanding at March 31, 2025 11,258,927 $ 16.24 6.46 $ - Options exercisable at March 31, 2025 8,748,097 $ 19.02 6.02 $ - At March 31, 2025, the Company has unrecognized stock-based compensation expense of approximately $ 12.8 million related to unvested stock options which will be recognized over the weighted average remaining service period of 1.99 years. Warrants A summary of the changes in outstanding warrants during the three months ended March 31, 2025 is as follows: Number of Shares Weighted Average Exercise Price Per Share Outstanding Warrants at December 31, 2024 1,382,613 $ 17.02 Expired ( 509,705 ) - Outstanding at March 31, 2025 872,908 $ 29.25 Warrants Vested at March 31, 2025 865,033 $ 29.28 At March 31, 2025, the Company had approximately $ 112,300 of unrecognized compensation expense related to outstanding warrants. At March 31, 2025, the aggregate intrinsic value of warrants vested and outstanding was $ 0 . Stock-based compensation by class of expense The following table summarizes the components of stock-based compensation expense which includes restricted stock, stock options, and warrants in the unaudited consolidated statements of operations for the three months ended March 31, 2025 and 2024 (rounded to nearest $00): Three Months Ended March 31, 2025 Three Months Ended March 31, 2024 Research and development $ 1,067,300 $ 1,699,300 General and administrative 3,410,700 6,596,200 Total $ 4,478,000 $ 8,295,500 12 Relmada Therapeutics, Inc. Notes to Unaudited Condensed Consolidated Financial Statements NOTE 8 - COMMITMENTS AND CONTINGENCIES License Agreements Third Party Licensor Based upon a prior acquisition, the Company assumed an obligation to pay a third party (Dr. Charles E. Inturrisi and Dr. Paolo Manfredi – see below): (A) royalty payments up to 2 % on net sales of licensed products that are not sold by sublicensee and (B) on each and every sublicense earned royalty payment received by licensee from its sublicensee on sales of license product by sublicensee, the higher of (i) 20 % of the royalties received by licensee; or (ii) up to 2 % of net sales of sublicensee. The Company will also make milestone payments of up to $ 4 or $ 2 million, for the first commercial sale of product in the field that has a single active pharmaceutical ingredient, and for the first commercial sale of product in the field of product that has more than one active pharmaceutical ingredient, respectively. As of March 31, 2025, 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. Charles E. Inturrisi and Dr. Paolo Manfredi (collectively, the Licensor). Pursuant to the Agreements, Relmada assigned its existing rights, including patents and patent applications, to esmethadone 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 esmethadone in the context of other indications such as those contemplated above. 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. As of March 31, 2025, no events have occurred, and the Company continues to pay Licensor $ 45,000 every three months. Arbormentis, LLC On July 16, 2021, the Company entered into a License Agreement with Arbormentis, LLC, a privately held Delaware limited liability company, by which the Company acquired development and commercial rights to a novel psilocybin and derivate program from Arbormentis, LLC, worldwide excluding the countries of Asia. The Company will collaborate with Arbormentis, LLC on the development of new therapies targeting neurological and psychiatric disorders, leveraging its understanding of neuroplasticity, and focusing on this emerging new class of drugs targeting the neuroplastogen mechanism of action. Under the terms of the License Agreement, the Company paid Arbormentis, LLC an upfront fee of $ 12.7 million, consisting of a mix of cash and warrants to purchase the Company’s common stock, in addition to potential milestone payments totaling up to approximately $ 160 million related to pre-specified development and commercialization milestones. Arbormentis, LLC is also eligible to receive a low single digit royalty on net sales of any commercialized therapy resulting from this agreement. The license agreement is terminable by the Company but is perpetual and not terminable by the licensor absent material breach of its terms by the Company. The new licensed program stems from an international collaboration among U.S., European and Swiss scientists that has focused on the discovery and development of compounds that may promote neural plasticity. Dr. Paolo Manfredi, co-inventor of REL-1017, and Dr. Marco Pappagallo, are among the scientists affiliated with Arbormentis, LLC. On May 12, 2025, the Company delivered to Arbormentis LLC a formal notice of termination of the License Agreement, ending the Company’s participation in the previously announced psilocybin development program. As a result of the cancellation, all obligations under the license agreement with Arbormentis will cease as of the effective termination date, which is 90 days after the date of notice. Trigone On March 24, 2025, we entered into an Exclusive License Agreement with Trigone, an Israeli company. The license agreement is for Trigone’s NDV-01 product, which is a novel, sustained-release, intravesical gemcitabine/docetaxel, ready-for-use product candidate for the treatment of NMIBC. Under the terms of the agreement, the Company made a $ 3,500,000 upfront payment on March 25, 2025, and issued 3,017,420 shares of common stock, which represent 10 % of the Company’s outstanding shares, for exclusive worldwide rights to NDV-01, excluding Israel, India and South Africa. In addition, the Company will pay up to $ 200 million in development, regulatory and sales milestones pending successful commercialization. The Company will also pay a royalty of 3 % on any net sales. 13 Relmada Therapeutics, Inc. Notes to Unaudited Condensed Consolidated Financial Statements NOTE 8 - COMMITMENTS AND CONTINGENCIES (continued) Leases and Subleases On August 1, 2021, the Company relocated its corporate headquarters to 2222 Ponce de Leon, Floor 3, Coral Gables, FL 33134, pursuant to a lease agreement with monthly rent of approximately $ 11,000 . The lease period was for five months . The lease agreement expired on December 31, 2021 and was renewed for each subsequent year with monthly rent for the years end December 31, 2025 and 2024 of approximately $ 4,100 , and $ 7,000 , respectively. Beginning on December 1, 2023, we leased office space at 12 E 49 th Street, New York, NY 10022 with monthly rent of approximately $ 12,000 ; that lease was terminated on May 31, 2024 . Beginning on May 29, 2024, we leased office space at 12 E 49 th Street, New York, NY 10022 with monthly rent of approximately $ 10,500 ; that lease expires on May 30, 2025 . In accordance with ASC 842, Leases , the Company has elected the practical expedient and recognizes rent expense evenly over the 12 months. For the three months ended March 31, 2025 and 2024, the Company recognized lease expense of approximately $ 44,800 and $ 62,400 , respectively. Legal 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. NOTE 9 - OTHER POSTRETIREMENT BENEFIT PLAN Relmada participates in a multiemployer 401(k) plan that permits eligible employees to contribute funds on a pretax basis subject to maximum allowed under federal tax provisions. The Company matches 100 % of the first 3 % of employee contributions, plus 50 % of employee contributions that exceed 3 % but do not exceed 5 %. The employees choose an amount from various investment options for both their contributions and the Company’s matching contribution. The Company’s contribution expense was $ 47,700 and $ 35,000 for the three months ended March 31, 2025 and 2024, respectively. NOTE 10 - SEGMENT REPORTING The Company determined its reporting units in accordance with ASC 280, Segment Reporting . Reportable operating segments are determined based on the management approach, as defined by ASC 280, is based on the way that the chief operating decision-maker (CODM) organizes segments within the Company for making operating decisions, assessing performance, and allocating resources. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates the Company. Management determined the Company’s operations constitute a single reportable segment in accordance with ASC 280: clinical stage drug development. The Company derives all of its losses from the development of clinical stage drugs expenses. The Company’s CODM is its chief executive officer and chief financial officer. The CODM assesses performance and makes operating decisions about allocating resources based on the research and development operating expenses on the Consolidated Statements of Operations. The CODM does not review assets in evaluating the results of the clinical stage development, and therefore, such information is not presented. The following table provides the operating expenses of our clinical stage drug development segment (rounded to the nearest $00): March 31, March 31, 2025 2024 Clinical Study Expense $ 7,960,600 $ 3,172,600 Other Research Expense 1,831,000 7,066,900 Manufacturing and Drug Storage Expense 155,600 292,500 Pre-clinical Expense - 33,700 Compensation Expense 933,500 1,040,300 Stock-based Compensation Expense 1,070,300 1,699,300 Total Research and Development Expense $ 11,951,000 $ 13,305,300 NOTE 11 - SUBSEQUENT EVENTS On May 12, 2025, the Company delivered to Arbormentis LLC a formal notice of termination of the Company’s License Agreement with Arbormentis LLC, ending the Company’s participation in the previously announced psilocybin development program. This decision was made following a strategic review of the Company’s research and development priorities. As a result of the cancellation, all obligations under the license agreement with Arbormentis will cease as of the effective termination date, which is 90 days after the date of notice. The Company does not expect any material financial impact resulting from this termination. 14