SAGE-324 Collaboration Terminated: A setback or a new beginning at Fulcrum Therapeutics and Biogen

Sage Therapeutics, Inc. SAGE announced the termination of its collaboration with partner Biogen BIIB regarding the investigational neurology candidate, SAGE-324. The phase II study on SAGE-324 for essential tremor did not meet the primary endpoint in July, leading to Biogen’s decision to end the partnership, effective from Feb. 17, 2025.

Sage Therapeutics will now have full ownership and rights to SAGE-324 and plans to explore other potential indications for the candidate. The company aims to pivot from this setback and potentially chart a new course for SAGE-324.

Year to date, shares of Sage Therapeutics have tumbled significantly by 66.9%, a stark contrast to the industry’s overall decline of 1.9%. This termination poses a challenging phase but also an opportunity for Sage Therapeutics to redirect its efforts towards future endeavors.

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The Unraveling of SAGE’s Licensing Agreement with BIIB

The disappointing results of the phase II KINETIC 2 study led to the abrupt halt of clinical development for SAGE-324 in essential tremor. This mutual decision between Sage Therapeutics and Biogen was a consequential outcome of the study’s failure to show a significant dose-response relationship on the primary endpoint for participants with ET.

While this is a setback for the companies, it opens up avenues for new strategies and partnerships going forward. Sage’s collaboration with Biogen for the depression drug Zurzuvae (zuranolone), which treats postpartum depression, remains a cornerstone of their joint efforts.

The FDA’s response to zuranolone’s application for major depressive disorder highlighted the need for further clinical studies to support the drug’s efficacy. This setback, coupled with the termination of SAGE-324 collaboration, presents challenges but also opportunities for Sage Therapeutics to reassess and recalibrate its future plans.

SAGE’s Zacks Rank & Market Projections

At present, Sage Therapeutics holds a Zacks Rank #3 (Hold). In comparison, Krystal Biotech, Inc. and Fulcrum Therapeutics, Inc. stand at favorable positions with a Zacks Rank #1 (Strong Buy).

Over the past few months, Krystal Biotech has witnessed a positive surge in earnings estimates, reflecting potential growth opportunities. Meanwhile, Fulcrum Therapeutics has shown resilience with narrowed loss per share estimates despite market challenges.

While Sage Therapeutics navigates this transitional phase post the SAGE-324 collaboration termination, the biotech sector continues to present dynamic opportunities for strategic growth and innovation.