Relmada Therapeutics , Inc. (NASDAQ:RLMD), a pharmaceutical company currently valued at $13.5 million, announced the appointment of Paul Kelly as Chief Operating Officer (COO) effective January 1, 2025. According to InvestingPro analysis, the company maintains a strong liquidity position with more cash than debt on its balance sheet, though it faces profitability challenges.
This decision was disclosed in a recent 8-K filing with the Securities and Exchange Commission. Kelly, already serving as a director and special advisor to the CEO, will receive an annual salary of $476,000 with potential for a 40% bonus. The employment agreement specifies that his role is "at will."
The company also revised employment agreements for top executives, aligning termination provisions with Kelly's terms. It has frozen salary increases, cash bonuses for fiscal 2024, and long-term incentive awards for the Named Executive Officers (NEOs) to reduce expenses.
This cost-cutting comes as InvestingPro data shows the company's challenging financial position, with analysts not anticipating profitability this year. InvestingPro subscribers have access to 8 additional key insights about RLMD's financial health and market position.
Additionally, Relmada has suspended retention payments previously approved in August 2024 for NEOs and Kelly, totaling $4.2 million for CEO Sergio Traversa, $2 million each for CFO Maged Shenouda and Chief Accounting and Compliance Officer Charles Ence, and $1.5 million for Kelly.
These payments were intended to compensate for the lack of equity-based compensation and were to be distributed quarterly over four years, subject to continued employment. The initial payments were made in September 2024.
The 8-K filing also includes amended and restated employment agreements for the NEOs, reflecting no substantive changes other than those related to stock option exercisability and clarification of current base salaries.
Relmada Therapeutics, based in Coral Gables, Florida, specializes in pharmaceutical preparations and is listed on the NASDAQ Global Select Market under the ticker symbol NASDAQ:RLMD. The information reported is based on statements from the company's SEC filing.
The stock has experienced significant volatility, with InvestingPro data showing an 86.75% decline over the past year, currently trading at $0.44, well below its 52-week high of $7.22. Subscribers to InvestingPro can access a comprehensive Pro Research Report offering detailed analysis of RLMD's financial health, market position, and growth prospects.
In other recent news, Relmada Therapeutics faced significant developments as the Data Monitoring Committee (DMC) deemed the REL-1017 RELIANCE II Phase 3 trial for major depressive disorder futile, marking a likely end for the treatment.
This unexpected outcome triggered a downgrade of the company's stock rating from Outperform to Neutral by Mizuho (NYSE:MFG) Securities and Leerink Partners. The disappointing results led to a significant reduction in the price target, from $23 to $1 by Mizuho and from $10 to $1 by Leerink Partners.
However, the company maintains a strong financial position, with $54 million in cash reserves reported at the end of the third quarter of 2024. Despite the setback with REL-1017, Relmada continues to focus on the development of its other product, REL-P11, currently in Phase 1 trials. The company's Q3 financials also reported a net loss of $21.7 million, with research and development expenses rising to $11.1 million.
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