Sage Therapeutics’ stock took a hard nosedive on Monday, dropping 46%, after the Food and Drug Administration (FDA) issued a Complete Response Letter regarding their application for the drug zuranolone for major depressive disorder.
Sage Therapeutics made history on Friday, gaining FDA approval for Zurzuvae (zuranolone) – the first oral medication to treat postpartum depression. On a conference call Monday, CEO Barry Greene shared his excitement, deeming the breakthrough “a historic moment for all women suffering from PPD.” Developed with partner Biogen, Zurzuvae could also prove successful in treating major depressive disorder.
MDD is a major victory for Sage and Biogen, as it affects a large portion of the population each year. In 2021, an estimated 21 million adults in the U.S. had a major depressive episode according to the National Institute of Mental Health, while PPD affects around half a million women annually. This discovery has the potential to change the lives of millions of people in the U.S. who suffer from major depressive disorder, making it an exciting advancement in the science and treatment of mental health.
Mike Yee, a biotech analyst at Jefferies, recently revealed that the drug’s potential as a treatment for clinical depression is worth far more than its intended use for postpartum depression – a staggering $1 billion compared to between $250 million to $500 million! These astounding figures present a new avenue of opportunity for patients and pharmaceutical companies alike.
Sage offered reassurances that it is “well capitalized” in its second quarter business update this Monday. Yet CEO Jeff Greene stated the company is evaluating their resource allocation, including pipeline prioritization and a workforce reorganization, in order to extend their cash runway. With the intention of reducing their operating expenses by 2024, it remains to be seen how much these changes will benefit Sage as they strive for sustainable success.
Biogen Also Takes a Hit
Biogen experienced a relatively mild reaction from the markets compared to PPD, with shares declining just 3% in premarket trading. However, Brian Skorney of Baird cautioned that this may be a false reprieve for the biotech, as the FDA’s decision not to approve zuranolone for a greater range of depression cases, coupled with its stringent safety warnings, was still a notable blunder for Biogen’s management.
The Zurzuvae label has a prominent warning: this medication can be abused and cause dependence. Those taking the drug should be cautious while driving, and all users of the drug should be aware of the risks associated with it.
The US Food and Drug Administration issued a Complete Response Letter in regard to the New Drug Application (NDA) for the treatment of Major Depressive Disorder (MDD), stating that the submitted application lacked evidence of effectiveness, necessitating further research before approval.
The Phase III CORAL study revealed a remarkable finding: zuranolone, a drug given alongside a standard of care antidepressant, significantly improved depressive symptoms just three days into the treatment – a result that held true for a two-week period. However, an earlier Phase III study showed no such benefit compared to placebo.
Following the FDA’s feedback on zuranolone’s potential use in treating Major Depressive Disorder (MDD), Biogen CEO Chris Viehbacher has stated that the partners are currently reviewing this response to determine the next steps. In a recent conference call, Biogen’s Chief Medical Officer Dr Alfred P.
Cohen offered little insight beyond this, only confirming that they are indeed “reviewing the feedback and evaluating next steps”. Although Biogen is open to further study on the matter, it is likely that due to their focus on cost-saving and recent job cut announcements, the company may not immediately proceed with a new late-stage MDD trial.
Greene voiced his dissatisfaction with the FDA’s decision on the use of zuranolone in MDD on Friday and Monday, and expressed his disappointment for patients-especially amid the current mental health crisis. He reiterated on the call that Sage and Biogen had not expected this setback late in the review, and made clear that Sage does not share the FDA’s opinion on the services approval.