Vistagen's Q2 2026 Earnings Call: Contradictions Emerge on Top Line Timelines, Enrollment in PALISADE-4, and Recruitment Challenges

Guidance:

• Top-line PALISADE-3 results to be released before the end of this calendar year.
• PALISADE-4 top-line results expected in the first half of 2026.
• $77.2M cash, cash equivalents and marketable securities as of Sept 30, 2025; company believes cash covers ongoing U.S. registration-directed PALISADE program including potential NDA submission.
• If PALISADE-3 is positive, company could submit an NDA around mid-2026; will engage FDA and expects to include typical NDA elements (repeat-dose, OLE safety, human factors, preclinical repro/carc).

Business Commentary:

* PALISADE-3 Trial Milestone: - Vistagen Therapeutics announced the last patient completed the randomized double-blind portion of the PALISADE-3 Phase III trial for their intranasal product candidate, fasedienol, for the acute treatment of social anxiety disorder. - The completion of this milestone paves the way for top-line results from the study to be released by the end of this calendar year.

• Financial Stability and Cash Reserves:
• As of September 30, 2025, Vistagen had $77.2 million in cash, cash equivalents, and marketable securities, which is believed to cover known aspects of their ongoing U.S. registration-directed PALISADE program for fasedienol.

• This financial strength is crucial for advancing the company's clinical programs and supporting its growth initiatives.

• Board Appointments and Expertise:

• Vistagen welcomed Mr. Paul Edick to its Board of Directors, bringing decades of experience in leading successful FDA approvals, commercial launches, and strategic transactions.

• This appointment aligns with the company's strategic focus on preparing for its next phase of growth and leveraging Edick's expertise in FDA approvals and commercialization.

• Pipeline Advancement and Potential:

• The company is continuing preparations to advance its broader pherine pipeline, including itruvone for major depressive disorder and PH80 for menopausal hot flashes.

• This diversification demonstrates Vistagen's commitment to addressing critical unmet needs in various therapeutic areas, leveraging its innovative neurocircuitry-focused potential.

• Clinical Trial Enrollment and Efficiency:

• Vistagen enhanced the PALISADE-3 and PALISADE-4 studies to ensure high-quality assessment for subject eligibility, leading to the enrollment of the full complement of patients as modeled.
• These enhancements and stringent recruitment processes aimed at minimizing screen fail rates and attrition, contributing to the successful completion of the PALISADE-3 trial.
  

  Sentiment Analysis:

  Overall Tone: Positive

  • Management repeatedly framed the period as "potentially transformative" and said "we've built a very strong momentum." They emphasized nearing key milestones, planning for NDA submission if PALISADE-3 is positive, and that $77.2M in cash covers the registration-directed PALISADE program.

Q&A:

• Question from Lin Tsai (Jefferies LLC): Look forward to the top line data readout soon. And so I think you guys have mentioned before that we should expect 6 to 8 weeks after the last visit for the top line release. Is that still the case? Or could it come earlier than that actually?
  Response: Management reiterated they are sticking with guidance: top-line results will be released before the end of this calendar year.

• Question from Lin Tsai (Jefferies LLC): For the top line analysis, how should we think about discontinuation rates, any protocol violations? Will that -- can we expect the top line to be pretty close in terms of the number of patients you've enrolled in the study? And then how should we also be thinking about the safety profile?
  Response: Top line will report primary (CGI‑I), key secondary (PGI‑C) and customary randomized-safety data from the public‑speaking challenge, similar to PALISADE‑2.

• Question from Lin Tsai (Jefferies LLC): From what you can tell, what have been the top reasons why patients screen failed in PALISADE-3? And are the top reasons different from what you saw in PALISADE-2?
  Response: Enhanced eligibility assessments and site execution were implemented; screen‑fail and attrition were in line with expectations and final enrollment met the modeled target (end target 236).

• Question from Matthew (Stifel): Assuming one of PALISADE-3 or PALISADE-4 works, is there anything else gating registration -- gating filing? Is there anything else that you need to complete before then? How soon can you file?
  Response: Typical NDA elements are required (repeat‑dose data, OLE safety, human factors, repro/carc studies); if PALISADE‑3 is positive and all goes to plan, an NDA could be submitted around mid‑2026.

• Question from Myles Minter (William Blair): Is it your view that fasedienol would be eligible for commissioner's priority review voucher (CMPV)? And regarding ClinicalTrials.gov updates: you terminated a site in Arkansas and Kansas — was that due to completed enrollment or site performance?
  Response: On CMPV: management does not currently expect fasedienol to fit typical CMPV criteria but will evaluate if regulatory pathways evolve; on sites: underperforming sites were closed and some closures were part of a wind‑down as the study neared completion.

• Question from Elemer Piros (Lucid Capital Markets): Do you have any indication on the usage patterns, perhaps from PALISADE‑2 or PALISADE‑3 open‑label data?
  Response: Usage patterns primarily come from open‑label data: episodic acute use concentrated on weekdays/work hours, tapering on weekends.

• Question from Elemer Piros (Lucid Capital Markets): Do you see any difference between the number of people entering the open‑label phase between PALISADE‑2 and PALISADE‑3, and roughly what percentage is that?
  Response: Management declined to give percentages but said open‑label entry rates have historically been high; non‑entry is usually due to life changes or relocation.

• Question from Elemer Piros (Lucid Capital Markets): What would be the minimal effect size in terms of the SUDS or the CGI that would be deemed clinically meaningful?
  Response: Clinical meaningfulness is judged across the primary (SUDS) and key secondaries (CGI‑I, PGI‑C); the aim is to replicate PALISADE‑2's statistically and clinically meaningful outcome.

• Question from Elemer Piros (Lucid Capital Markets): How do you think about commercialization at this stage? On your own, be a partner? Have you thought about this recently?
  Response: Company is preserving optionality: capable of a direct commercial launch but remains open to strategic partnerships if they maximize value.

Contradiction Point 1

Top Line Readout Timeline

It involves the expected timeline for the top line readout, which directly impacts investor expectations and the company's regulatory progress.

Could the top-line data readout for PALISADE-3 occur before the expected 6-8 week period following the last visit? - [Lin Tsai](Jefferies LLC)

2026Q2: Vistagen will stick with the guidance that top line results will be released before the end of this calendar year. - [Shawn Singh](CEO)

Do you plan to announce study enrollment completion and, if so, when? Can you provide any commentary on dropout rates, retention, or conversion to the open-label extension? - [Julian Pino](Stifel, Nicolaus & Company, Incorporated)

2026Q1: We expect to see Top Line Readout in Q4. - [Shawn Singh](CEO)

Contradiction Point 2

Enrollment in PALISADE-4

It involves the status of enrollment in the PALISADE-4 study, which is crucial for the company's ongoing clinical trials and the progress of its product development.

What were the top reasons for patient screening failures in PALISADE-3 compared to PALISADE-2? - [Lin Tsai](Jefferies LLC)

2026Q2: In fact, we're now actively enrolling PALISADE-3 and PALISADE-4 and we're on target to complete enrollment in PALISADE-4 in Q3. - [Joshua Prince](COO)

Regarding PALISADE-4, can you comment on enrollment? Now that trial 3 is complete, are you starting enrollment for trial 4? - [Myles Minter](William Blair & Company L.L.C.)

2026Q1: Both PALISADE-3 and 4 are still enrolling consistent with our guidance. - [Shawn Singh](CEO)

Contradiction Point 3

Timing of PALISADE-3 Top Line Results

It involves the expected timeline for the release of top line results from the PALISADE-3 study, which is crucial for investors and stakeholders to anticipate the progress of the drug development process.

Will the PALISADE-3 top-line data be released earlier than the expected 6-8 weeks post last visit? - [Lin Tsai](Jefferies LLC)

2026Q2: Vistagen will stick with the guidance that top line results will be released before the end of this calendar year. - [Shawn Singh](CEO)

Will there be a PALISADE-3 data readout and when will top-line data be reported? - [Lin Tsai](Jefferies LLC, Research Division)

2025Q4: We aim to limit variability in PALISADE-3 and 4 and replicate the success of PALISADE-2. We will announce when enrollment for PALISADE-3 is complete, followed by a 6 to 8-week period to report top-line data, pending any necessary queries. - [Shawn Singh](CEO)

Contradiction Point 4

Recruitment Challenges in PALISADE-3 and PALISADE-4

It pertains to the recruitment issues faced by the company for PALISADE-3 and PALISADE-4, which can impact the timelines and feasibility of the clinical trials.

What were the reasons for terminating the Arkansas and Kansas sites on clinicaltrials.gov in late October? - [Myles Minter](William Blair & Company L.L.C.)

2026Q2: Some sites were terminated due to their inability to enroll appropriate patients, and a few were part of a wind-down approach to control variability and ensure efficient top line results. - [Joshua Prince](CMO)

Are recruitment issues for PALISADE-3 and -4 related to the Liebowitz Social Anxiety Scale or independent raters? - [Myles Minter](William Blair & Company L.L.C.)

2025Q4: The recruitment issue is not related to the Liebowitz Social Anxiety Scale or the independent raters. It is primarily due to strict eligibility criteria and secondary review processes, which have initially slowed the participation but are now improving. - [Shawn Singh](CEO)

Contradiction Point 5

Data Timing and Execution

It pertains to the timeline of data release for critical clinical studies, which is crucial for investor expectations and regulatory timelines.

Could the top-line data for PALISADE-3 be released earlier than the 6- to 8-week window after the last visit? - [Lin Tsai](Jefferies LLC)

2026Q2: Vistagen will stick with the guidance that top line results will be released before the end of this calendar year. - [Shawn Singh](CEO)

Do you expect the data from PALISADE-3 and PALISADE-4 to remain in the second half of this year, or potential delays? - [Unidentified Analyst](Jefferies)

2025Q3: We're confident that we'll see data from both PAL-3 and PAL-4 in 2025. - [Shawn Singh](CEO)