Deal Or No Deal? Sage Therapeutics Soars On Acquisition Proposal From Biogen

Sage Therapeutics

20.74 CHF -42.55%

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Kaufen / Verkaufen

(RTTNews) - Shares of Sage Therapeutics Inc. (SAGE) jumped over 45% to $8.09 in after-hours on Friday, on receipt of an unsolicited, nonbinding acquisition proposal from Biogen Inc. (BIIB).

Biogen has offered to acquire all of the outstanding shares of Sage Therapeutics, which it doesn't already own, for $7.22 per share. Biogen currently holds a 10.2% stake in Sage, according to a SEC filing.

The partnership between the two companies dates back to 2020.

In November 2020, Sage and Biogen entered into a collaboration to jointly develop and commercialize SAGE-217 and SAGE-324. As part of the collaboration, Biogen purchased about 6.24 million shares of Sage on December 31, 2020, at approximately $104.14 per share, for a total of about $650 million.

SAGE-217 secured the regulatory nod in August 2023, becoming the first and only FDA-approved oral treatment for women with postpartum depression and the drug is marketed under the brand name Zurzuvae. However, the other drug candidate developed in collaboration with Biogen, SAGE-324, has faced significant setbacks.

In July 2024, a phase IIb study of SAGE-324 in Essential Tremor, dubbed KINETIC 2, failed to meet its endpoints. Following the disappointing results, Biogen terminated its collaboration with Sage, specifically related to SAGE-324 in September 2024.

Sage has also been grappling with major trial setbacks, particularly with its lead drug candidate, Dalzanemdor.

In April 2024, Dalzanemdor, also known as SAGE-718, did not meet its primary endpoint in a phase II trial in patients with mild cognitive impairment in Parkinson's disease, dubbed PRECEDENT. The challenges persisted into the second half of 2024, with two more trial failures.

A phase II trial of Dalzanemdor in participants with mild cognitive impairment or mild dementia due to Alzheimer's Disease, dubbed LIGHTWAVE, flunked in October, followed by disappointing results from a phase II study Of Dalzanemdor in Huntington's Disease in November 2024.

Regarding the acquisition proposal, Sage said that its Board of Directors will carefully review and evaluate Biogen's offer to determine the next course of action.

During its heydays in January 2018, the stock was trading as high as $195.

In the last 1 year, SAGE has traded in a range of $4.62 to $28.26. The stock closed Friday's trading at $5.55, down 5.13%.