Sage Therapeutics(SAGE) - 2020 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Revenues for Q3 2020 were $1.6 million from sales of ZULRESSO, compared to $1.5 million for the same period in 2019, indicating a slight increase despite the impact of COVID-19 [30] - Selling, general and administrative expenses decreased to $35.1 million in Q3 2020 from $88.5 million in Q3 2019, primarily due to a reduction in commercial support for ZULRESSO following a restructuring [31] - Research and development expenses were $74.1 million in Q3 2020, down from $102.1 million in Q3 2019, attributed to the completion of the MOUNTAIN study and decreased spending on clinical pharmacology studies [31] - The net loss for Q3 2020 was $105.7 million, compared to $180 million for the same period in 2019 [32] - The company ended the quarter with $671 million in cash and equivalents, expecting to finish the year with approximately $550 million, providing a runway into 2022 [32] Business Line Data and Key Metrics Changes - The SHORELINE study for zuranolone in major depressive disorder (MDD) reported that 72% of patients achieved a response and 40% achieved remission after a 14-day treatment cycle with 30 mg [17] - For the 50 mg cohort, 75% of patients achieved a response and 48% achieved remission by the end of the initial treatment cycle [17] - The KINETIC study for SAGE-324 in essential tremor continues to enroll patients, with top-line data expected in Q1 2021 [25] Market Data and Key Metrics Changes - The ongoing COVID-19 pandemic has significantly affected ZULRESSO revenues, with expectations of continued adverse impacts even post-pandemic due to barriers to treatment [30] - The company anticipates a significant increase in the need for mental health treatments due to rising depression rates during the pandemic [68] Company Strategy and Development Direction - The company aims to disrupt the treatment model in depression and is focused on developing innovative therapies across its three franchises: depression, neurology, and neuropsychiatry [13] - The strategy includes advancing multiple clinical programs and maintaining a strong balance sheet to support operations and pipeline development [29] - The company is preparing for significant milestones over the next 12 to 18 months, with a focus on zuranolone as a potential first-in-class therapy for depression [23] Management's Comments on Operating Environment and Future Outlook - Management highlighted the increased demand for mental health solutions due to the pandemic and expressed confidence in the execution of clinical programs [9][10] - The management team is optimistic about the potential catalysts in the coming months, particularly regarding the SHORELINE study results [10][32] - The company is committed to delivering effective therapies for patients suffering from brain health disorders [28] Other Important Information - The company has a robust clinical pipeline with multiple studies ongoing, including the LUMINARY study for SAGE-718 in Alzheimer's disease, expected to begin dosing by the end of 2020 [27] - The management emphasized the importance of understanding patient populations that may respond best to treatments, particularly in the context of ongoing studies [41] Q&A Session Summary Question: Can you elaborate on SAGE-718 and its potential? - Management discussed SAGE-718 as a lead asset in the NMDA platform, highlighting its potential to improve cognitive function in various disorders [40] Question: What is the status of the REDWOOD study? - Management indicated that REDWOOD results will be needed for filing in the episodic pathway, with ongoing studies informing their understanding [46] Question: How do you view the essential tremor program's endpoints? - Management believes a 30% to 50% reduction in tremor amplitude would be clinically meaningful, based on previous studies [47] Question: Can you provide insights on the SHORELINE study results? - Management noted that nearly half of the patients did not require additional treatments within a year, indicating a persistent response in some patients [63] Question: What are the plans for the LUMINARY study? - Management confirmed that the LUMINARY study will focus on cognitive performance, with potential examination of event-related potentials [79]