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Sage Crumbled After Single Trial Failure, But Few Catalysts In The Near Term May Turn Things Around

Mar. 03, 2020 12:51 PM ETSage Therapeutics, Inc. (SAGE)4 Comments


  • Sage Therapeutics noted that it will meet with the FDA in the coming months and may still be able to flesh out a path forward for SAGE-217 to treat MDD.
  • Another product in the pipeline known as SAGE-324 will be evaluated in a phase 2 placebo-controlled study treating patients with Essential Tumors; expected start of 1st half of 2020.
  • Results from a phase 1 study, using SAGE-324 to treat patients with Essential Tremors, are expected to be readout in 2020.
  • Sage has roughly $1 billion in cash as of December 31, 2019, and expects this cash to fund the pipeline for at least the next 12 months.
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Sage Therapeutics (NASDAQ:SAGE) recently gave an update on several of its clinical programs. The main item investors were probably keeping an eye on was SAGE-217. That's because this product had failed a late-stage study treating patients with major depressive disorder. This program has been put on hold for the time being, while the company discusses a potential path forward. In my opinion, it's possible that Sage can recover with this program. Even if it ultimately doesn't, there are several other products in the pipeline that are being advanced toward other indications. For instance, there is SAGE-324 to be advanced in the 1st half of 2020 in a placebo-controlled study treating patients with essential tremors. It has many other products in the pipeline that it can advance. Therefore, while SAGE-217 is important, it doesn't define the biotech. That's why I believe it is a good buy after the stock had taken a huge hit back in December of 2019. Especially, the way it has traded the last few months.

SAGE-217 Still Has A Possible Path Forward

Several months ago, Sage Therapeutics announced results from its phase 3 MOUNTAIN study. This study was using SAGE-217 to treat patients with major depressive disorder. Major Depressive Disorder or MDD is characterized as where a person has an intense and persistent form of sadness for an extended period of time. For instance, you might experience sadness when a loved one dies or a very bad event happens for a day or a few weeks. However, people with MDD experience sadness for an even longer period of time. This is a good market for the biotech go after because believe it or not it is quite prevalent amongst people. In the United States, MDD is the most common mental disease. It was observed in 2016

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This article was written by

Terry Chrisomalis profile picture

Terry Chrisomalis is a private investor in the Biotech sector with years of experience utilizing his Applied Science background to generate long term value from Healthcare.

He is the author of the investing group Biotech Analysis Central which contains a library of 600+ Biotech investing articles, a model portfolio of 10+ small and mid-cap stocks with deep analysis for each, live chat, and a range of analysis and news reports to help Healthcare investors make informed decisions.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (4)

Another AKAO in the making
It’s over
Goomba69 profile picture
Saying SAGE-217 has a potential path forward is wishful thinking. Desperate companies (or more accurately the desperate executives in the companies) often use post hoc analysis to identify responder groups, and then squander years of time and significant resources to fail once again.
loftguy profile picture
I would wait for a secondary offering in Q4 2020 before entering SAGE.
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