Analyst Conference Summary


Sage Therapeutics

conference date: February 24, 2021
for quarter ending: December 31, 2020 (fourth quarter, Q4)

Forward-looking statements

Overview: Not much revenue, but data due in 2021 could have a significant impact.

Basic data (GAAP):

Revenue was $1.1 billion, up sequentially from $1.6 million, and up from $2 million year-earlier. Almost all revenue was from Biogen collaboration deal.

net income was $975 million, up sequentially from negative $106 million, and up from negative $169 million year-earlier.

Earnings per Share (EPS) were $18.19, up sequentially from negative $2.03, and up from negative $3.25 year-earlier.


Expects end of 2021 cash and equivalents over $1.7 billion, but does not expect any milestone payments in 2021.

Conference Highlights:

Barry Greene, CEO, said "Although 2020 was a challenging year, Sage's commitment to rigorous science, innovation and disciplined execution resulted in significant progress across all of our brain health franchises, strongly positioning us in our efforts to deliver revolutionary medicines to millions of patients. Our collaboration with Biogen enhances our strategic, financial, and operational flexibility, enabling our plans to expand and accelerate our pipeline and extending the potential impact of our product candidates, if we are successful, to more than 450 million patients worldwide. In the first months of 2021, we have already begun to realize this expansion and acceleration with the progression of multiple early-stage programs. I believe 2021, with 10 expected data readouts, will be a transformational year for Sage in our mission to become the leading brain health company in the next five years."

Product revenue in Q4 was $1.7 million.

Sage entered a collaboration agreement with Biogen in November 2020. They will jointly develop SAGE-217 (zuranolone) for depressive disorders and SAGE-324 for essential tremor. Could be worth $3.1 billion, received $1.5 billion at closing including $875 million upfront, $650 million equity investment. Potential milestone payments are $1.6 billion. Joint commercialization in U.S., Biogen commercializes outside the U.S.

Zuranolone for major depressive disorder positive Phase 3 (shoreline) interim results released in October 2020 showed good tolerance and safety. 70% achieved a response, 40% a remission. 30 mg dose data should be available in 1H 2021. Also testing at 50 mg and with repeat dosing. Zuranolone is a modulator of GABA-A receptors. Also being studied for postpartum depression, with topline data expected in 2021. Waterfall Phase 3 study has closed enrollment with 30mg data due 1H 2021, 50mg in late 2021. The Skylark post-partum depression Phase 3 study should report results in late 2021.

Zulresso (brexanolone) for postpartum depression royalty revenue was $1.6 million, up from $1.5 million year-earlier. The company plans to start a Phase 3 study for COVIC-19 realted acute respiratory distress in Q4 2020.

SAGE-324 is in an ongoing Phase 2 study for essential tremor, with topline data expected in Q1 2021.

SAGE-718 is in a Phase 2a open-label study for Parkinson's Disease cognitive dysfunction with topline data expected in Q1 2021. A second Phase 2 study for Alzheimer's cognitive dysfucntion and mild dementia is expected to start before year-end 2021. It is an NMDA modulator.

Phase 1 study for SAGE-689 for acute GABA hypofunction data expected to complete in 2021.

Phase 1 study of SAGE-904 for NMDA hypofuction expected to complete in 2021.

Sage initiated a Phase 3 trial of brexanolone in patients with advanced COVID-19 related acute respiratory distress syndrome in Q42020 under the Coronavirus Treatment Acceleration Program (CTAP). Topline data expected in 2021.

Cash and equivalents balance ended he quarter at $2.1 billion, up sequentially from $671 million due to the Biogen deal.

Cost of goods sold were $0.1 million. R&D expense was $82 million. Selling, general and administrative expense $53 million. Restructuing costs $0.1 million. Total operating costs $135 million. Income from operations $974 million. Interest income $1 million.

Q&A summary:

Waterfall data for filing independent of other trials? Depends on totality of data. We don't believe we need the Redwood study, given the Shoreline data. Waterfall will be helpful, but mainly Shoreline. There are multiple independent approaches to filing and approval.

50 mg dose overall effect, what would be compelling? Upsizing of study allows more powering, plus subset analysis. Benefit/risk is different from prior drugs. Data so far is pointing to a consistent profile, including durable effects. Upsize was possible while remaining on timeline because of the increase of depression during the pandemic.

Waterfall patients need a diagnosis of MDD, but it can be their first episode, regardless of cause, including possibly being pandemic related.

Essential tremor study scale used? We use scales that track best with disability. These tend to be upper limb. We are looking for 30% to 50% reduction in tremor in a significant percentage of patients. We will work with the FDA on an appropriate registration endpoint, including sustained improvement.

Essential tremor study difference with other companies? We want to know if prolonged dosing changes response rates, we saw early data to that effect. We hope to study our new mechanism, hope it can be used for chronic dosing.

Patient compliance issue in trials? In Mountain we saw some non-compliance. We believe when people take the drug, it works, but there is a necessary threshold. So we increased the dose for Waterfall.

Waterfall follow up period? Will continue to last patient enrolled, last visit, then all data points will be entered before analysis.

Sleepiness we are seeing in patients in evenings is a positive, it helps them rewire, many were taking something to help them sleep.

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Disclaimer: My analyst call summaries may include both condensations of statements made by company representatives and my own analysis. They are not covered by any warranty. I cannot guarantee anything said by company representatives is true. I try not to make errors, but it is possible. These are my personal notes which I share with other investors and which I use as the basis of my blog and Seeking Alpha articles.

Copyright 2021 William P. Meyers