Biogen & Sage Therapeutics Announce Global Development & Commercialization Collaboration

Biogen Inc. and Sage Therapeutics, Inc.  recently announced they have executed a global collaboration and license agreement to jointly develop and commercialize zuranolone (SAGE-217) for major depressive disorder (MDD), postpartum depression (PPD) and other psychiatric disorders and SAGE-324 for essential tremor and other neurological disorders.

“We are excited about the potential to bring together Biogen’s leading capabilities in neuroscience with Sage’s deep expertise in psychiatry,” said Michel Vounatsos, Biogen’s Chief Executive Officer. “Major depressive disorder affects approximately 17 million people in the US alone, and is a common co-morbidity of multiple neurological disorders in Biogen’s core therapeutic areas. There is a tremendous unmet medical need in depression, and we are optimistic about the potential for zuranolone to help transform the treatment of depression and address the stigma often associated with chronic use of antidepressants.”

“With the recent and pending data outputs for zuranolone and SAGE-324, the timing is right for a collaboration between two like-minded companies committed to patients and driven by a passion for neuroscience and brain health,” added Mike Cloonan, Chief Operating Officer at Sage Therapeutics. “Through this collaboration, Sage and Biogen have the potential to build something greater together than either could have done alone. We will leverage each other’s existing expertise while continuing to build new capabilities in our efforts to create paradigm shifts in the treatment of depression, PPD and essential tremor — disorders that have gone too long with few treatment innovations. Additionally, the cash from the collaboration is expected to enable Sage to accelerate and expand value potential for its pipeline and will enhance Sage’s strategic, financial and operational flexibility as well as strengthening our multi-franchise approach.”

Zuranolone, a potential first-in-class, 2-week, once-daily oral therapy in development for the treatment of MDD and PPD, is currently in Phase 3 development as part of the LANDSCAPE and NEST clinical programs. Zuranolone has breakthrough therapy designation from the US FDA for MDD and, if successfully developed and approved, has the potential to be a novel treatment paradigm in depression.

The vision for zuranolone in MDD and PPD is based on its potential, being evaluated in the LANDSCAPE and NEST development programs, to work rapidly and to continue providing sustained benefit beyond the period of dosing. Together, these two features, if supported by positive clinical efficacy and safety data, could provide an alternative option to how depression is treated today based on a target profile of an “as-needed” short course of treatment for a depressive episode, with rapid and sustained efficacy and favorable tolerability. The development of an “as-needed” treatment for depression may help ease the difficulties associated with chronic use of antidepressants and may enhance quality of life and patient adherence.

An estimated 17 million Americans experience symptoms of MDD each year. Additionally, a September 2020 Journal of the American Medical Association article found that, in the US, depression symptoms are more than three times higher during the COVID-19 pandemic than before. MDD is one of the largest contributors to disability in the US and worldwide.

Postpartum depression is a major depressive episode that can occur during pregnancy or postpartum and is one of the most common medical complications during and after pregnancy. In the US, an estimated 1 in 8 mothers experience symptoms of PPD which equates to approximately 500,000 annual cases.

If approved, zuranolone would also be highly complementary to several of Biogen’s therapeutic areas of focus, including multiple sclerosis (MS), Alzheimer’s disease (AD), spinal muscular atrophy (SMA), amyotrophic lateral sclerosis (ALS) and Parkinson’s disease (PD). Depression is a common co-morbidity in patients with these neurological disorders and their caregivers. Biogen estimates that ~ 50 percent of patients with MS, ~ 40 percent of patients with AD, ~ 50 percent of patients with PD, ~ 30 percent of patients with ALS and ~ 60 percent of SMA caregivers experience depression. In addition, many patients with AD see psychiatrists as part of their diagnostic and/or treatment journey.

Zuranolone is a next-generation positive allosteric modulator of the gamma-aminobutyric acid (GABA_A) receptor. The GABA_A system is the major inhibitory signaling pathway of the brain and central nervous system (CNS), and contributes significantly to regulating CNS function. This mechanism of action is a novel approach that may enable a new class of antidepressants.

To date, two positive pivotal studies have been completed with zuranolone 30 mg, one in MDD (MDD-201) and one in PPD (ROBIN Study). Additionally, while the Phase 3 MOUNTAIN Study of zuranolone in MDD did not meet its primary endpoint, the encouraging data from the recently announced MOUNTAIN six-month follow-up period and the topline interim SHORELINE Study analysis, suggest the potential for zuranolone, if successfully developed and approved, to be uniquely positioned as a disruptive, distinct and novel treatment approach for patients. Biogen and Sage believe that zuranolone is clinically active in MDD based on the data compiled to date and look forward to planned data readouts in 2021.

Sage is pursuing three development pathways for zuranolone in the US: PPD; acute rapid response therapy (RRT) in MDD when co-initiated with new standard antidepressant therapy; and “as-needed,” or episodic, treatment of MDD. As a result, Sage is advancing four additional pivotal studies evaluating a 50 mg dose of zuranolone: a Phase 3 study in PPD (SKYLARK, PPD-301), a Phase 3 study of use as an acute RRT in patients with MDD when co-initiated with new standard antidepressant therapy (CORAL, MDD-305), a Phase 3 study in the acute treatment of MDD (WATERFALL, MDD-301B) and an open label Phase 3 study evaluating the long-term safety, tolerability and efficacy of “as-needed” repeat treatment (SHORELINE, MDD-303). Data from these studies are expected in 2021.

Upon closing of the transaction, Biogen and Sage will collaborate to further define the development and commercialization strategy for zuranolone. Beyond PPD and MDD, zuranolone may also have potential in other psychiatric disorders including bipolar disorder and generalized anxiety disorder.

SAGE-324 is a next-generation positive allosteric modulator of GABA_A receptors in Phase 2 development for essential tremor with potential in other neurological conditions such as epilepsy and PD. Essential tremor is one of the most common movement disorders estimated to affect over six million patients in the US, and current standard of care may be inadequate for many. Following encouraging results from a Phase 1 open-label study in essential tremor, Sage advanced SAGE-324 to the Phase 2a KINETIC Study, which Sage is currently conducting. The KINETIC Study is a 28-day placebo-controlled study in patients with essential tremor expected to read out in 2021. Upon closing of the transaction, Biogen and Sage will collaborate to further define the development and commercialization strategy for SAGE-324 in essential tremor and, as appropriate, for potential expansion into other neurological disorders.

The strategic collaboration is global in scope and under the terms of the agreement, Sage will receive $1.525 billion in cash to be comprised of an upfront payment of $875 million and a $650 million equity investment in Sage from the purchase of approximately 6.2 million newly issued shares of Sage common stock at a price of $104.14 per share, representing a premium of 40 percent over the 30-day volume-weighted average share price of $74.39 per share as of November 25, 2020.

Should the zuranolone and SAGE-324 programs achieve certain development and commercial milestones, Sage will be eligible to receive up to approximately $1.6 billion in potential milestone payments.

Biogen and Sage will share responsibility and costs for development as well as profits and losses for commercialization in the US (50% Biogen; 50% Sage). Outside the US, Biogen will be responsible for development and commercialization, excluding Japan, Taiwan and South Korea with respect to zuranolone, and will pay Sage tiered royalties in the high teens to low twenties.

Closing of the transaction is contingent on completion of review under antitrust laws, including the Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976 in the US, and other customary closing conditions. The transaction is expected to close by the end of January 2021.

BofA Securities and Guggenheim Securities acted as financial advisors to Biogen. Goldman Sachs & Co. LLC is acting as the exclusive financial advisor to Sage.

At Biogen, our mission is clear: we are pioneers in neuroscience. Biogen discovers, develops and delivers worldwide innovative therapies for people living with serious neurological and neurodegenerative diseases as well as related therapeutic adjacencies. One of the world’s first global biotechnology companies, Biogen was founded in 1978 by Charles Weissmann, Heinz Schaller, Kenneth Murray and Nobel Prize winners Walter Gilbert and Phillip Sharp. Today Biogen has the leading portfolio of medicines to treat multiple sclerosis, has introduced the first approved treatment for spinal muscular atrophy, commercializes biosimilars of advanced biologics and is focused on advancing research programs in multiple sclerosis and neuroimmunology, Alzheimer’s disease and dementia, neuromuscular disorders, movement disorders, ophthalmology, immunology, neurocognitive disorders, acute neurology and pain. We routinely post information that may be important to investors on our website at www.biogen.com. Follow us on social media – Twitter, LinkedIn, Facebook, YouTube.

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.