Layoffs as Sage Therapeutics reshuffles CNS pipeline

By Jonathan Smith

- Last updated on GMT

© Getty Images
© Getty Images

Related tags Antidepressant CNS Drug development

Less than a month after the U.S. Food and Drug Administration (FDA) gave its antidepressant drug zuranolone (Zurzuvae) a mixed welcome, Sage Therapeutics has launched plans to reorganize its operations by refocusing its drug development efforts and laying off 40% of its workforce.

According to its new strategy, Sage plans to build up commercial muscle to fuel the launch of Zurzuvae, which is developed in collaboration with Biogen and was approved by the FDA for the treatment of postpartum depression (PPD) in August 2023. The drug is designed to modulate proteins called gamma-aminobutyric acid type A (GABA-A) receptors in the brain and to show benefits within days rather than weeks as do current antidepressants. Sage aims to commercially launch Zurzuvae in late 2023.

The company also expects to pause undisclosed early-stage drug development programs and instead to focus on the development of two phase 2-stage candidates: one for the treatment of neuropsychiatric conditions such as Huntington’s disease and Parkinson’s disease and the other for the treatment of Parkinson’s disease and forms of epilepsy.

“Our goal is to think big, start small and scale fast as we look to launch Zurzuvae and help women suffering with PPD​. Executing on launch and our potential long-term growth catalysts requires us to allocate resources strategically,” said Sage CEO Barry Greene in a public statement.

At the same time as approving Zurzuvae for the treatment of PPD, the FDA rejected the same drug for the treatment of major depressive disorder, which is a larger indication. The agency’s Complete Response Letter (CRL) asked for more studies supporting the effectiveness of Zurzuvae in major depressive disorder. Sage and Biogen are reviewing the feedback and evaluating their next steps.

In light of the regulatory setback and workforce cuts, Sage is keen to extend its cash runway to 2026. The firm’s cash reserves total around $1 billion as of the end of June 2023 and the company expects to save roughly $240 million per year, with 60% of this sum related to R&D. The company also expects to gain funding from its ongoing collaborations, including a $75 million milestone payment from Biogen triggered by the first commercial sale of Zurzuvae for the treatment of PPD.

The company also announced changes to its leadership team, with chief scientific officer, chief development officer and SVP of Medical Affairs departing the company.

Sage focuses on research into disorders of the central nervous system (CNS) with a pipeline of modulators designed to influence brain chemistry. In 2019, its lead product brexanolone (Zulresso) was approved by the FDA as an intravenous injection for the treatment of PPD.

While Sage bagged a vital approval of Zurzuvae earlier this year, the firm faces a hurdle: the treatment must be scheduled as a controlled substance by the U.S. Drug Enforcement Administration due to its potential for abuse. This could influence how much the drug is prescribed to patients.

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