Sage Therapeutics, Inc., a pharmaceutical company, has announced the termination of a key agreement with Biogen (NASDAQ:BIIB) MA, Inc. and Biogen International GmbH regarding their collaboration on SAGE-324, a drug molecule initially developed for the treatment of essential tremor. The termination, effective February 17, 2025, follows the recent announcement of negative results from the Phase 2 KINETIC 2 Study of SAGE-324 and the subsequent decision to discontinue its clinical development for this indication.
Under the original Collaboration and License Agreement dated November 27, 2020, Sage Therapeutics and Biogen had agreed to jointly develop and commercialize products containing Sage's SAGE-217 and SAGE-324 molecules, with Biogen handling development and commercialization outside the United States, excluding certain Asian territories for SAGE-217. The agreement allowed Biogen to terminate for convenience, which they have now exercised for the SAGE-324 molecule class.
Despite the termination related to SAGE-324, the partnership between the two companies continues for ZURZUVAE® (zuranolone), which is the first and only FDA-approved oral treatment for women with postpartum depression. Both companies will remain responsible for their respective share of costs for ongoing activities related to the SAGE-324 products until the termination takes effect.
With the termination, all licenses granted to Biogen for the SAGE-324 products will expire. However, Biogen will grant Sage Therapeutics a perpetual license for any Biogen-related technology concerning the SAGE-324 products as of the termination date, as per the terms of their agreement.
The details of the original collaboration were disclosed in filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K on February 24, 2021, and the Quarterly Report on Form 10-Q on November 2, 2021.
The termination of the agreement with Biogen marks a significant shift in Sage Therapeutics' partnership landscape, although the company continues to maintain its other collaborative efforts and product development activities.
In other recent news, Sage Therapeutics reclaimed full ownership of SAGE-324 after Biogen exited their partnership due to unfavorable study outcomes, while the collaboration on ZURZUVAE, a treatment for postpartum depression, remains intact. Financial firms have adjusted their outlooks on Sage. Truist Securities trimmed its stock target from $18 to $13, maintaining a Hold rating.
Piper Sandler also revised its outlook, cutting the price target from $70 to $52, but maintaining an Overweight rating. Mizuho Securities and Stifel adjusted their outlooks as well, reducing their price targets to $12 and $15 respectively.
Sage announced $7.4 million in collaboration revenue for Q2 2024, attributed to Zurzurvae. Despite a Q2 net loss of $102.9 million, the company reported having $647 million in cash, projecting funding to last until 2026. Sage plans to expand its sales force in Q4 2024 to boost Zurzuvae sales in 2025.
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