Could Opioids Treat Depression? This Biotech Plans to Find Out

Every year, about 17.3 million adults in the U.S. will experience at least one major depressive episode. Approximately 1 in 3 will fail to see improvement in their symptoms after treatment involving at least two different types of medications, and will be diagnosed with a condition called treatment-resistant depression (TRD). Tragically -- and by definition -- there is a lack of effective treatments for this condition. Patients with TRD are twice as likely as patients with regular depression to be hospitalized and often suffer debilitating episodes or mental breakdowns that can severely affect quality of life.

Fortune has not been kind to drug companies looking into drug candidates that could combat TRD. Recently, Axsome Therapeutics ' (NASDAQ: AXSM) candidate failed to demonstrate efficacy against placebo in its late-stage clinical trial. While Johnson & Johnson 's (NYSE: JNJ) recently approved Spravato provides fast depression relief in patients with TRD, the drug is known to have serious side effects, putting patients at risk of developing suicidal tendencies or becoming heavily sedated. Hence, the pharmaceutical industry is working to find a solution that can provide relief for TRD patients without subjecting them to further psychological risk from side effects. One potential candidate is Relmada Therapeutics ' (OTC: RLMD) REL-1017, an opioid that has demonstrated significant potential in phase 2 trials targeting TRD. The mere thought of using an opioid to treat depression, however, may sound the alarm bell for some investors.

Can the company be successful, and does it warrant a buy? Let's find out together.