Sage Therapeutics-Biogen Partnered Depression Candidate Under Priority FDA Review, Analyst Says Its 'Incrementally Positive'

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• The FDA has accepted for review a marketing application seeking approval for Sage Therapeutics Inc (NASDAQ: SAGE) and Biogen Inc's (NASDAQ: BIIB) zuranolone for major depressive disorder (MDD) and postpartum depression (PPD).
• The FDA has assigned a Prescription Drug User Fee Act (PDUFA) action date of August 5, 2023.
• William Blair views the acceptance as an important milestone for the company. The analyst believes the granting of priority review, though not surprising, is an incremental positive as it reflects the FDA's acknowledgment of the significant unmet need in the indication and novelty of zuranolone's mechanism and dosing schedule.
• The analyst rates Sage Therapeutics shares with a Market Perform rating and continues to rate Biogen shares with Outperform rating.
• William Blair says that while the press release included no comment about an advisory committee, it expects the FDA will hold one, given the novel mechanism and dosing profile and the mixed data across its MDD studies.
• William Blair writes that the results from the SKYLARK study of zuranolone 50 mg in PPD bolster the package for zuranolone, and it continues to expect approval in both MDD and PPD by the PDUFA date.
• Still, the marginal benefits observed in WATERFALL and CORAL may limit zuranolone's position in the MDD treatment paradigm.
• For Biogen, this sets up another second-half 2023 event for the stock. Still, the focus will remain primarily on the Leqembi launch, potential full approval, and potential NCD revisions by the CMS in Alzheimer's disease.
• Price Action: SAGE shares are up 5.03% at $46.38, and BIIB shares are up 2.08% at $289.53 on the last check Monday.
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