Sage gets a peek at success treating postpartum depression, and its shares soar

Sage CEO Jeff Jonas

In recent years, developing new drugs for depression has become one of the most frustrating tasks in biotech. Big and small companies alike have struggled to demonstrate a positive effect against hard-to-control placebo responses in clinical trials or prove that dramatic and quick responses in small groups can translate into safe and broadly used drugs. Sage Therapeutics ($SAGE), though, is touting the results it's seen in just four patients, insisting that the outcomes are so dramatic that they create a clear snapshot of efficacy that will now drive a new program into the clinic as the biotech expands beyond its initial foray into treating a rare disease.

And investors are eating it up, driving Sage stock up 20% this morning in a bout of premarket enthusiasm.

Sage used its lead drug--SAGE-547, which has demonstrated an ability to resolve persistent and rare brain seizures--on four women suffering from severe postpartum depression, a condition that affects about one in 5 women following the birth of a child. On average, the women had a 26.5 rating on a standard questionnaire used to measure their depression. After taking the drug, that number fell to a symptom-free level of 1.8.

Dr. Jeff Jonas, the CEO of Sage, called that "an early but encouraging signal of activity in women with severe PPD," adding that "we believe [the results] further validate that the SAGE-547 mechanism of action has the potential to impact a broad range of disorders beyond epilepsy."

Helped by a solid track record, a rep for serious science and an exclusive advanced look by Forbes reporter Matthew Herper, who talked to experts in the field who were both upbeat about the results as well as skeptical, Sage's shares soared.

Sage actually cut short the study, which was intended to recruit 15 patients in search of 10 evaluable responses, saying the outcomes were so dramatic that they justified accelerating a plan to move 547 into a placebo-controlled study as they select another, potentially better, therapy for clinical development.

Moving past the immediate drumbeat of enthusiasm among biotech-focused investors, though, Sage is entering a dramatically different field than the orphan-sized arena it initially chose. Small patient populations are commonly used to illustrate early signs of success against rare diseases. But in depression, a condition that afflicts millions of people, the field has been littered with so many failures that small trial groups often tend to raise more questions than they answer.

Ketamine, or "Special K" as it's called on the party scene, has also had an instantaneous impact on depression. But investigators at Johnson & Johnson ($JNJ) and elsewhere have been struggling to create a safe drug free of side effects that can do the same task. Few developers in this field would claim a breakthrough with results from four patients.

"It looks very exciting," the Cleveland Clinic's Dr. Adele Viguera told Herper. "It's only four patients but what's exciting is that you can treat someone relatively quickly for post-partum depression."

Countered Columbia-Presbyterian psychiatry chair Dr. Jeffrey Lieberman: "It's an interesting target and a plausible mechanism of action. At this point it's a theory with some anecdotal supporting evidence and you can't really say much more."

Jonas says the company will follow the initial glimpse of success into the clinic, looking to create a new paradigm for treating mental ailments. And despite the rush, it won't be quick and it won't be easy.

- here's the release