Analyst Conference Summary

biotechnology

conference date: April 29, 2025 @ 1:30 PM Pacific Time
for quarter ending: March 31, 2025 (first quarter, Q1)

Forward-looking statements

Overview: Zurzuvae revenue growth was good, but on a small base.

Basic data (GAAP):

Revenue was $14.1 million, up 10% sequentially from $12.8 million, and up 78% from $7.9 million year-earlier.

Net income was negative $62.2 million, up sequentially from negative $95.8 million, and up from negative $108.5 million year-earlier.

Earnings per Share (EPS) were negative $1.01, up sequentially from negative $1.56, and up from negative $1.80 year-earlier.

Guidance:

Believes cash runway to mid-2027. Believes overall operating expenses will decrease substantially in 2024.

Conference Highlights:

Barry Greene, CEO, said "We delivered strong growth in revenue and shipments of ZURZUVAE during the first quarter of 2025 through the team’s disciplined execution and unwavering commitment to bringing Zurzuvae to more women with postpartum depression. We remain focused on establishing Zurzuvae as the standard of care for women with postpartum depression and driving our business strategy forward with the goal of creating value for shareholders." Reviewing strategic initiatives. Starting to see signs of a paradigm shift towards prescribing Zurzuvae for PPD.

A strategic reorganization of Sage was announced in October 2024. Focus will be on the Zurzuvae launch and on dalzanemdor for HD. Should reduce costs. Expects op ex to decrease in 2025 from 2024. Will discontinue research on Zurzuvae for major depressive disorder.

In Q4 2024 Sage received $13.8 million, up 21% sequentially from $11.4 million, in collaboration revenue from Zurzuvae (50% of net revenue from Biogen). More than 3,000 prescriptions shipped, up sequentially from about 2,500. Most payers are aligned to provide access as a first line therapy. Coverage discussions continue to progress, with positive feedback. Obgyns are the main prescribers so far, about 80% of total. 95% of commercial and Medicaid lives now covered. Inventory levels have normalized. The three national PBMs now have favorable access policies. Repeat prescription rate reached 60%. For about 70% of Zurzuvae PPD patients, it is their first treatment. Number of prescribers increased by 20% in Q1 2025. Salesforce expansion completed in Q1 2025.

Sage estimates that about 477,000 women experience PPD annually in the US. However, many cases are undiagnosed or untreated when diagnosed.

Zulresso is being discontinued in favor of Zurzuvae. There were no sales in Q1 2025.

Sage-718, now Dalzanemdor, has an ongoing Phase 2 study in cognitive impairment associated with Huntington's Disease, and an open-label Phase 3 safety study in HD. The study in Alzheimer's failed in Q3 2024.

Sage plans to further expand the Zurzuvae salesforce in 2025. Also some DTC ads.

SAGE-319 for disorders in social interaction (autism), data from Phase 1 study expected by end of 2025.

Also has SAGE-817 and SAGE-039 in pre-clinical development. SAGE-324 for seizures in developmental and epileptic encephalopathies is being evaluated for a possible Phase 2 indication.

Cash and equivalents balance ended the quarter at $424 million, down sequentially from $504 million.

Cost of goods sold were $0.6 million. R&D expense was $23 million. Selling, general and administrative expense $58 million. Restructuring $0.5 million. Total operating costs $81.5 million. Income from operations negative $76.5 million. Interest and other income $5 million.

Q&A selective summary:

Early pull through from sales initiatives? Strong Q1 revenue growth, expect that to continue for remainder of year. Focus on OBGYNs. Screening of PPD is expanding.

Pipeline confidence? Recalibrated approach, focussed pipeline. Validated targets. Believe could create major patient impact and shareholder value. Strong biological rational, feasible regulatory pathways, possible clinical validation.

Why have some providers and patients not chose Zurzuvae? About 70% of those prescibed are front line. We do not see obstacles to use.

Inventory? Fluctuating. Shipments are from specialty pharmacies.

Believe Zurvuvae has blockbuster potential. Demand trend is more important than any inventory fluctuations. Physician awareness is now remarkably high.

In Q1 we would not see the classic Medicare donut hole impacts that many drugs see.

Payer coverage, ease? 95% coverage by payers, but sometimes see requests for prior authorization, but must receive within 2 or 3 days.

What would it take to see a significant upward inflection that could get you to profitability? Happy with current rapid growth. We believe Zurzuvae will be cash-flow positive by the end of 2026, while we have a cash runway into 2027.

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