VistaGen Therapeutics, Inc (VTGN) Equity Research Report, Dec. 2020

evaluated based on the change in total score as measured by the Hamilton Rating Scale for Depression, a widely used clinician-administered depression assessment scale. After one week of treatment, a mean HAM-D-17 score reduction of 10.1 points was noted for the 6.4 µg cohort, a significantly greater reduction than the 4.2 point decrease from baseline observed in the placebo group (p=0.03). Similarly, at the end of Week 8, a mean HAM-D-17 score reduction of 17.8 was noted, a statistically greater reduction than the 10.9 point decrease noted in the placebo group (p=0.02). Important to note is that the effects are rapid, sustainable and safe, without the psychological and safety issues like with ketamine. Based on the positive data from the P2a study, the company plans to further evaluate the efficacy of PH10 as a potential stand-alone therapy for MDD in an upcoming planned P2b study. Expanded patent portfolio. Recently, the company announced (on 12/10) a patent was issued for PH10 as a stand-alone treatment for MDD by the Korean Intellectual Property Office (KIPO). This recently-issued patent expands the company's patent portfolio for PH10, which was previously issued for patents in the US, Greater China, EU, and Japan. PH94B is a neuroactive steroid called a pherine. Through its nasal spray formulation, it acts through the chemosensory receptors in the nose and inhibits nerve circuits associated with SAD producing an anxiolytic effect. Prior clinical studies by Pherin Pharmaceuticals (private) have demonstrated that PH94B’s local (vs. systemic) as needed delivery allows for rapid 10-15 minute onset and convenient dosing as well as a favorable safety profile. PH94 in Social Anxiety Disorder (SAD), upcoming P3 study. The randomized, double-blind, placebo-controlled P3 trial for PH94B has a target enrollment of N=182 patients with SAD across 12-15 sites. The trial's design resembles that of the prior, highly statistically significant (p=0.002) P2 study, which included a single-event, laboratory-stimulated public speaking challenge. Assessment of the Subjective Units of Distress Scale (SUDS) will serve as the study's primary efficacy endpoint. An important distinction from the P2 design is the use of a single primary endpoint (vs. both LSAS and SUDS in P2) in the upcoming P3 study, which renders a more time- and cost-efficient trial. Initiation of the trial expected CY2Q21. Recall this program has Fast Track Designations, the only SAD-focused therapy to gain this designation from FDA. Recall in June, Vistagen announced that it entered into a licensing agreement with EverInsight Therapeutics (private, merged with AffaMed Therapeutics on 10/14/20; AffaMed name retained, LINK ) to develop and commercialize PH94B in Greater China, Southeast Asia, and South Korea for anxiety-related disorders. AffaMed will also be able to contribute to the clinical program data package with patients from the region. VistaGen will receive an upfront payment of $5M from AffaMed and will be eligible for milestone payments of up to $172M, plus royalties. Dr. Louis Monti appointed as VP on 12/1. Dr. Monti has previously served as President and CEO of Pherin Pharmaceuticals since July 2018. Prior to his role as CEO, Dr. Monti served as the company's Executive VP for 16 years, and before then as its VP of Research for 11 years from its founding in 1991. Dr. Monti also held various academic positions at the University of Utah and the University of the Republic, Uruguay. Dr. Monti received his M.D. from the University of Republic, Uruguay School of Medicine and his Ph.D. in Physiology and Pharmacology from the University of Utah. Dr. Monti holds multiple memberships, including in the New York Academy of Sciences, the American Society of Clinical Pharmacology, and the International Brain Organization. Following VistaGen's acquisition of the pherin platform (PH94 and PH10), Dr. Monti has worked closely with the company in a consultative capacity, and was recently appointed as VP for the company (announced on 12/1/20). This is a key appointment to the VistaGen team, in our view, as both PH10 and PH94B advance into late stage development in 2021. AV-101. Recall that AV-101 is an oral NMDA modulating drug being developed for depression. While the drug missed on a primary endpoint (change in MADRS-10 score) in P2 back in November 2019, the story and path forward for AV-101 was, and still is, far from over. A lot was learned in that study and combined with activity and lessons learned around the NMDA space, VistaGen and its collaborators continue to advance the program, which should now be facilitated by the strong balance sheet. The drug has shown positive early data in a P1b trial in development for suicide- ideation and receptor target engagement (note LINK ) . The drug has also shown 2 Maxim Group LLC VistaGen Therapeutics, Inc. (VTGN)