Sage Therapeutics Announces Restructuring to Advance Corporate Strategy and Pipeline
April 07 2020 - 4:01PM
Business Wire
Changes are expected to result in annualized
cost savings of approximately $170 million, including SG&A
savings of $150 million
Headcount reduction of 340 – approximately 53
percent of workforce
Current balance of cash, cash equivalents,
restricted cash, and marketable securities expected to support
operations into 2022
Based on current information, anticipated 2020
and 2021 R&D milestones remain unchanged
Conference call today at 4:30 p.m. EDT
Sage Therapeutics, Inc. (NASDAQ: SAGE), a biopharmaceutical
company committed to developing novel therapies with the potential
to transform the lives of people with debilitating disorders of the
brain, today announced a restructuring intended to enable the
Company to advance its corporate strategy and pipeline. The
resulting cost savings are comprised of a reduction in the
workforce of approximately 53 percent, in addition to an expected
decrease in external expenses that together are anticipated to
result in annualized savings of approximately $170 million, of
which $150 million is related to SG&A. The workforce reduction
will primarily affect the ZULRESSO™ (brexanolone) CIV injection
commercial operation and related SG&A support functions. The
Company remains committed to working with healthcare providers and
patients seeking access to ZULRESSO, but commercial efforts will be
focused on geographies that have existing, active ZULRESSO treating
sites.
“The headwinds we are facing individually and collectively,
along with a recognition of our need to move forward as a company,
have led to this difficult decision. We believe this cost reduction
and reallocation of resources will help Sage advance our portfolio
in a way that is consistent with our mission of delivering
medicines that matter to people with serious brain health
disorders,” said Jeff Jonas, M.D., chief executive officer at Sage
Therapeutics. “Unfortunately, we will be saying goodbye to some of
our valued colleagues and I want to thank them for their dedication
to always doing what’s best for patients. Moving forward, we are
confident that we have a great team that will continue to execute
on our multi-franchise strategy. We believe Sage’s mission is more
important than ever, especially as mental health issues are coming
to the forefront and will continue to have significant impact, even
after the current phase of the pandemic.”
Based on the current operating plan and assumptions, Sage
expects that its balance of cash, cash equivalents, restricted
cash, and marketable securities of approximately $1.0 billion at
the end of 2019 will support operations into 2022. Sage expects to
incur a one-time cost of approximately $31 million, associated with
the reduction in workforce, primarily in the second quarter of
2020. The Company anticipates operating expenses in 2020 will be
lower than the previous year; additional financial guidance will be
provided on the Company’s 1Q 2020 quarterly earnings update in
May.
The Company continues to focus on its three brain health
franchises – depression, neurology and neuropsychiatry – and
anticipated 2020 and 2021 R&D milestones remain unchanged.
Strategic focus areas
The restructuring will enable the Company to focus on key
strategic areas and supporting ongoing development activity,
including:
- Planned initiation and completion of three new zuranolone
pivotal studies; completion of the 30 mg arm of zuranolone
SHORELINE Study in major depressive disorder (MDD)
- Efforts to meet clinical timelines goals, including those
related to SAGE-324 and SAGE-718
- Maintain a level of access to ZULRESSO by focusing on
geographies with existing treating sites that administer this
innovative treatment
2020 planned trial initiations
- Zuranolone (topline data anticipated in 2021)
- Initiate Phase 3 study evaluating zuranolone 50 mg in women
with postpartum depression (PPD)
- Initiate Phase 3 study evaluating zuranolone 50 mg in patients
with MDD
- Initiate Phase 3 study evaluating zuranolone 50 mg in patients
with MDD as an acute rapid response treatment (RRT) when
co-initiated with an SSRI
- Add cohort to Phase 3 SHORELINE Study evaluating zuranolone 50
mg in patients with MDD
- SAGE-324
- Initiate Phase 2 study evaluating SAGE-324 60 mg in essential
tremor (ET) (1H 2020)
- SAGE-718
- Initiate Phase 2a open-label study or studies evaluating
SAGE-718 in one or more disorders associated with cognitive
dysfunction (2020)
Conference Call/Webcast Information:
Sage will host a conference call and webcast today, Tuesday,
April 7, 2020, at 4:30 p.m. EDT to discuss the recent corporate
updates. The live webcast can be accessed on the investor page of
Sage's website at investor.sagerx.com. A replay of the webcast will
be available on Sage's website approximately two hours after the
completion of the event and will be archived for up to 30 days.
About Sage Therapeutics
Sage Therapeutics is a biopharmaceutical company committed to
developing novel therapies with the potential to transform the
lives of people with debilitating disorders of the brain. We are
pursuing new pathways with the goal of improving brain health, and
our depression, neurology and neuropsychiatry franchise programs
aim to change how brain disorders are thought about and treated.
Our mission is to make medicines that matter so people can get
better, sooner. For more information, please visit
www.sagerx.com.
Forward Looking Statements
Various statements in this release concern Sage's future
expectations, plans and prospects, including without limitation,
our statements as to: the potential cost savings from our
restructuring; expected reductions in external expenses; the amount
of the expected one-time cost associated with our restructuring;
our expectations that the cost savings from the restructuring will
help advance our programs and our mission; our expectations with
respect to 2020 operating expenses and our belief that existing
cash will support operations into 2022; our clinical development
plans and expected timelines; and the goals, opportunity and
potential for our business. These forward-looking statements are
neither promises nor guarantees of future performance, and are
subject to a variety of risks and uncertainties, many of which are
beyond our control, which could cause actual results to differ
materially from those contemplated in these forward-looking
statements, including the risks that: we may not realize expected
cost savings from the restructuring, including the anticipated
decrease in external spend, at the levels we expect; we may
encounter delays in initiation or conduct of our planned clinical
trials, including slower than expected site initiation or
enrollment, that may impact our ability to meet our expected
time-lines and increase our costs; the internal and external costs
required for our ongoing and planned activities, and the resulting
impact on expense and use of cash, may be higher than expected
which may cause us to use cash more quickly than we expect or
change or curtail some of our plans or both; our expectations as to
expenses, cash usage and cash needs may prove not to be correct for
other reasons such as changes in plans or actual events being
different than our assumptions; we may be opportunistic in our
future financing plans even if available cash is sufficient; we may
not be successful in our development of any of our product
candidates in any indication we are currently pursuing or may in
the future pursue; success in our non-clinical studies or in
earlier clinical trials may not be repeated or observed in ongoing
or future studies, and ongoing and future non-clinical and clinical
results may not meet their primary or key secondary endpoints or be
sufficient to file for or gain regulatory approval to market the
product without further development work or may not support further
development at all; we may encounter adverse events at any stage of
development that negatively impact further development or that
require additional nonclinical and clinical work which may not
yield positive results; we may encounter different or more severe
adverse events at the higher doses we are planning to study in new
trials; we may encounter issues with the efficacy or durability of
short-term treatment, or co-initiated treatment with zuranolone or
safety and efficacy concerns with respect to retreatment that
require additional studies be conducted; the FDA may ultimately
decide that the design or results of our completed and planned
clinical trials for any of our product candidates, even if
positive, are not sufficient for regulatory approval in the
indications that are the focus of our development plan; other
decisions or actions of the FDA or other regulatory agencies may
affect the initiation, timing, design, size, progress and cost of
clinical trials and our ability to proceed with further
development; the spread of the COVID-19 pandemic and related fears
in the U.S. and outside the U.S., measures taken to curb the spread
of the virus, and avoidance of healthcare settings and public
interactions as a result of the foregoing may negatively impact
expected site initiation or enrollment in our clinical trials, or
cause us to pause trials, in each case which may significantly
impact our ability to meet our expected time-lines or may
significantly impact our costs or other aspects of our business or
cause us to have to change our plans; we may encounter technical
and other unexpected hurdles in the development and manufacture of
our product candidates which may delay our timing or change our
plans or increase our costs; as well as those risks more fully
discussed in the section entitled "Risk Factors" in our most recent
Annual Report on Form 10-K, as well as discussions of potential
risks, uncertainties, and other important factors in our subsequent
filings with the Securities and Exchange Commission. In addition,
any forward-looking statements represent our views only as of
today, and should not be relied upon as representing our views as
of any subsequent date. We explicitly disclaim any obligation to
update any forward-looking statements.
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version on businesswire.com: https://www.businesswire.com/news/home/20200407005747/en/
Investor Contact Jeff Boyle 347-247-5089
jeff.boyle@sagerx.com
Media Contact Maureen L. Suda 585-355-1134
maureen.suda@sagerx.com
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