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Sage Therapeutics Announces Major Restructuring Following Zurzuvae FDA Approval

Sage Therapeutics, in response to the FDA’s narrower-than-expected approval of its flagship antidepressant Zurzuvae, has announced significant changes to its operations and leadership team.

This strategic restructuring is aimed at adapting to the altered market landscape while positioning the company for future growth and success.

1.      Headcount Reduction: Sage Therapeutics will reduce its workforce by 40%. This cost-saving measure is a direct response to the FDA’s approval of Zurzuvae for post-partum depression (PPD) but not for major depressive disorder (MDD). MDD represents a more substantial market opportunity, and the rejection of this indication led to a reassessment of the company’s operations.

2.      R&D Project Adjustments: As part of the cost-cutting efforts, some research and development (R&D) projects will be temporarily sidelined. The aim is to allocate resources more efficiently and reduce the company’s annual expenses.

3.      Cost Savings: Sage Therapeutics expects annual savings of approximately $240 million due to these changes. The majority of these savings, around two-thirds, will come from the R&D budget. The cost of implementing the job cuts is estimated to be in the range of $36 million to $38 million.

4.      Leadership Changes: Significant leadership changes are occurring within the company. Abi Robichaud, the Chief Scientific Officer and one of the company’s founders, is departing but will maintain a consultancy role and become an advisory board member. Mike Quirk, currently Senior Vice President of Discovery Research, will take over as the new Chief Scientific Officer. Co-founder Jim Doherty, Chief Development Officer, is also leaving, with his responsibilities transferred to Chief Medical Officer Laura Gault. Head of Medical Affairs, Mark Pollack, is stepping down, and Chief Business Officer Chris Benecchi will assume his responsibilities.

5.      Focus on Commercial Operations: Sage Therapeutics plans to redirect some of the savings from R&D towards strengthening its commercial operations. This includes hiring new sales representatives in preparation for the launch of Zurzuvae for PPD in the fourth quarter of the year.

6.      Biogen Partnership: There is speculation that Biogen, Sage’s partner in the development of Zurzuvae, may reconsider its involvement due to the limited FDA label and the potential costs associated with securing an MDD indication. Biogen is also engaged in its cost-cutting efforts.

7.      Financial Position: Sage Therapeutics ended the second quarter with approximately $1 billion in cash. Additionally, it is set to receive a $75 million milestone payment from Biogen upon the first commercial sales of Zurzuvae for PPD. The company also generates revenue from an IV drug for PPD called Zulresso (brexanolone).

8.      Extended Cash Runway: The cost reductions are expected to extend Sage’s cash runway from 2025 into 2026. This additional financial stability is crucial as the company anticipates data readouts in the coming year for two mid-stage drugs: SAGE-718 for cognitive impairment associated with Huntington’s and other neurological disorders, and SAGE-324, a GABAA drug in development for essential tremor and epilepsies secondary to disorders like Parkinson’s disease.

Sage Therapeutics says it remains committed to launching Zurzuvae for PPD and addressing the needs of women suffering from this condition. CEO Barry Greene emphasized the importance of allocating resources strategically to execute the launch effectively and capitalize on potential long-term growth opportunities.


Dr. Oche Otorkpa PG Cert, MPH, PhD

Dr. Oche is a seasoned Public Health specialist who holds a post graduate certificate in Pharmacology and Therapeutics, an MPH, and a PhD both from Texila American University. He is a member of the International Society of Substance Use Professionals and a Fellow of the Royal Society for Public Health in the UK. He authored two books: "The Unseen Terrorist," published by AuthorHouse UK, and "The Night Before I Killed Addiction."
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