Analyst Conference Summary


Sage Therapeutics

conference date: May 3, 2022 @ 5:00 AM Pacific Time
for quarter ending: March 31, 2022 (first quarter, Q1)

Forward-looking statements

Overview: Began rolling NDA for zuranolone for MDD.

Basic data (GAAP):

Revenue was $1.6 million, flat sequentially from $1.6 million, and flat from $1.6 million year-earlier, which was largely collaboration revenue.

Net income was negative $122 million, up sequentially from negative $125 million, and down from negative $97 million year-earlier.

Earnings per Share (EPS) were negative $2.07, up sequentially from negative $2.12, and down from negative $1.64 year-earlier.


Expects cash and equivalents to end 2022 at about $1.3 billion.

Conference Highlights:

Barry Greene, CEO, said "Current events have put a spotlight on the need for significant progress in brain health disorders, and at Sage, we’ve made a strong start to 2022 with the initiation of our rolling regulatory submission for zuranolone in major depressive disorder and meaningful progress across our entire pipeline. We are currently executing four Phase 2 studies across our neuropsychiatry and neurology franchises, and we recently presented encouraging data from our SAGE-718 program in patients with mild cognitive impairment due to Parkinson's disease and mild cognitive impairment and mild dementia due to Alzheimer's disease at key scientific forums."

In April 2022 Sage and Biogen started a rolling NDA submission to the FDA for zuranolone for the treatment of MDD (major depressive disorder), based largely on the Waterfall study data. An additional filing for PPD (postpartum disorder) is anticipated in the first half of 2023. This follows recent discussions with the FDA, including a pre-NDA meeting held in the fall of 2021. In October 2021, Sage and Biogen had announced that data presented at the European College of Neuropsychopharmacology (ECNP) Congress further showed a rapid and sustained reduction in depressive symptoms and a unique and well-tolerated safety profile. Received Fast Track designation. CORAL study z + ADC met its primary and key secondary endpoints. Shoreline study enrollment is ongoing, now with over 1000 patients.

Sage is preparing its go to market approach for zuranolone.

More zuranolone data from the Coral and Shoreline for MDD, and Sunbird and Skylark for PPD studies are expected in 2022.

Already talking to KOLs and getting good feedback on the zuranolone data.

Collaboration with Biogen has resulted in a decrease in R&D expense, but plans to expand the pipeline mean that will increase again. SG&A also expected to increase in 2022 as preparing for zoranolone launch.

Zulresso (brexanolone) for postpartum depression royalty revenue was $1.6 million, flat sequentially and down from $1.7 million year-earlier.

SAGE-324 Phase 2 placebo-controlled study for essential termor is enrolling.

Sage-718 is in studies for Huntington's, Parkinson's, and Alzheimer's caused cognitive disorders. The Huntington's and Parkinson's trials are in Phase 2. A Phase 2/3 OLE study in Huntington's should start in late 2022. A Phase 2 study in Alzheimer's should start in 2022.

Phase 1 study for SAGE-689 for acute GABA hypofunction continues enrollment.

Phase 1 study of SAGE-904 for NMDA hypofuction continues enrollment.

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.

Cash and equivalents balance ended he quarter at $1.63 billion, down sequentially from $1.74 billion.

Cost of goods sold were $0.3 million. R&D expense was $78 million. Selling, general and administrative expense $46 million. Total operating costs $125 million. Income from operations negative $123 million. Interest and other income $1 million.

Q&A summary:

Skylark study 12 month window? Excited by the study, repeating the Robin study with a different dose and longer endpoint. Women with PPD have symptoms that persist, this

Zuranolone has an incredibly broad therapeutic index. Patients often have problems sleeping, so have some somnulence effect actually helps them. Rates are in the teens, which compares well with current standards of care. You also see less side effects.

718 physician feedback? Presentations at AAN were crowded, reaction was encouraging. "There is nothing mild about mild cognitive impairment."

What would you like in the zuranolone label? All the modules for submission are in very good shape, some work remains on two studies. Looking for MDD and PDD with or without elevated anxiety. Not sure what kind of warnings there would be, will probably accept the classic ones.

At commercial launch, if approved, net profit share will go on its own line on P&L, which would be 50% of revenue. We are working with national and regional payers, who appear receptive because of the need for a more effective therapy. It appears to be highly attractive to payers because of its quick effect and relative lack of adverse events.

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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 2022 William P. Meyers