Reunion Neuroscience Inc. Reports Fiscal Results and Provides Corporate Update

LOS ANGELES– Reunion Neuroscience Inc. a clinical-stage biopharmaceutical company specializing in innovative therapeutic solutions for underserved mental health conditions, announced its fiscal results for the fourth quarter and year ended March 31, 2023. Additionally, the company provided a corporate update, highlighting recent developments in its business operations and clinical advancements.

On June 1, 2023, Reunion revealed its agreement to a take-private transaction led by MPM BioImpact, a prominent biotechnology investment firm. The deal, valued at approximately US$13.1 million, will be an all-cash transaction. Under the terms, shareholders will receive US$1.12 in cash for each share held prior to the effective time of the take-private transaction. The anticipated closing of the transaction is set for the third quarter of 2023, subject to the fulfillment of specific closing conditions.

In another significant development, Reunion announced the appointment of Fred Grossman, D.O., FAPA, a seasoned pharmaceutical executive, to its Board of Directors. Dr. Grossman brings over twenty years of experience in clinical development, medical affairs, pharmacovigilance, and health outcomes. He has held key leadership positions in various pharmaceutical companies, including Empyrean Neuroscience, Mesoblast Limited, and NeuroRx Pharma.

Recent Clinical Developments: Phase 1 Final Analysis and RE200 Series

Reunion presented the final analysis of its first-in-human Phase 1 trial with RE104 at the American Society of Clinical Psychopharmacology (ASCP) Annual Meeting, held on June 1, 2023. The findings indicated that RE104 exhibited favorable tolerability, with robust pharmacodynamic effects observed at doses equal to or greater than 30mg of RE104 (33mg of RE104 HCl). These effects closely aligned with the pharmacodynamic profile of its prodrug, 4-OH-DiPT (isoprocin). Moreover, scores from the Drug Effect Questionnaire and Mystical Effect Questionnaire suggested the potential for therapeutic benefits.

The trial also highlighted that the average duration of experience with RE104 at these doses was 3.7 hours, indicating a shorter duration of action compared to psilocybin. However, the intensity and quality of the experience remained consistent. The adverse event profile of RE104 was similar to that of psilocybin, with no reported serious adverse events. Based on this data, Reunion has selected a 30mg dose of RE104 (33mg RE104 HCl) for a forthcoming randomized, placebo-controlled Phase 2 trial targeting women with moderate to severe post-partum depression. The Phase 2 trial is scheduled to commence in the second half of 2023.

Furthermore, Reunion Neuroscience continues to advance its RE200 series of molecules. These compounds, structurally similar to classic psychedelics, possess enhanced receptor selectivity and show promise in addressing various therapeutic applications. They exhibit selective potency at the target serotonin 2A receptor (5HT2A) while lacking 5HT2B receptor agonism.

Financial Highlights

Reunion Neuroscience reported general and administrative expenses of $4.0 million and $13.0 million for the three and twelve month periods ending March 31, 2023, respectively. These figures represent an increase from $3.1 million and $11.0 million for the same periods in 2022. The rise in expenses can be attributed to the growth in headcount and other costs associated with the company’s transition to a public entity, as well as the expansion of operations related to the clinical stage development of RE104.

Research and development expenses for the three and twelve month periods ended March 31, 2023, amounted to $4.4 million and $13.0 million, respectively. In comparison, expenses for the same periods in 2022 were $2.3 million and $7.0 million. The increase in expenses is primarily due to investments in personnel, third-party manufacturing, and clinical research for RE104’s Phase 1 trial, as well as regulatory and startup activities in preparation for the Phase 2 clinical study targeting postpartum depression.

Other income and expenses encompassed interest income on the company’s cash and cash equivalents, foreign currency gains and losses, and investment tax credits received through Canada’s Scientific Research and Experimental Development tax incentive program. Notably, the company recognized a $1.5 million gain and a $13.8 million loss for the three and twelve months ended March 31, 2023, respectively. These figures are associated with a loss allowance for financial guarantees and the write-off of the equity investment in Field Trip Health & Wellness Ltd.

Reunion Neuroscience reported a net loss from discontinued operations of $10.4 million for the twelve month period ended March 31, 2023. This contrasts with losses of $8.2 million and $36.9 million for the three and twelve month periods ended March 31, 2022, respectively. The net loss from continuing operations for the three and twelve month periods ending March 31, 2023, amounted to $6.5 million or $0.56 per share and $38.1 million or $3.28 per share, respectively. By comparison, the losses for the same periods in 2022 were $5.9 million or $0.11 per share and $17.8 million or $0.31 per share, respectively.