Sage Therapeutics, Inc., a biopharmaceutical company committed to developing novel therapies with the potential to transform the lives of people with debilitating disorders of the brain, announced a restructuring intended to enable the Company to advance its corporate strategy and pipeline.
The resulting cost savings are comprised of a reduction in the workforce of approximately 53 percent, in addition to an expected decrease in external expenses that together are anticipated to result in annualized savings of approximately $170 million, of which $150 million is related to SG&A. The workforce reduction will primarily affect the ZULRESSO™ (brexanolone) CIV injection commercial operation and related SG&A support functions. The Company remains committed to working with healthcare providers and patients seeking access to ZULRESSO, but commercial efforts will be focused on geographies that have existing, active ZULRESSO treating sites.
“The headwinds we are facing individually and collectively, along with a recognition of our need to move forward as a company, have led to this difficult decision. We believe this cost reduction and reallocation of resources will help Sage advance our portfolio in a way that is consistent with our mission of delivering medicines that matter to people with serious brain health disorders,” said Jeff Jonas, M.D., chief executive officer at Sage Therapeutics.
Based on the current operating plan and assumptions, Sage expects that its balance of cash, cash equivalents, restricted cash, and marketable securities of approximately $1.0 billion at the end of 2019 will support operations into 2022. Sage expects to incur a one-time cost of approximately $31 million, associated with the reduction in workforce, primarily in the second quarter of 2020.
The Company continues to focus on its three brain health franchises – depression, neurology and neuropsychiatry – and anticipated 2020 and 2021 R&D milestones remain unchanged.