Biogen, Sage Therapeutics in $3.1-Bn Pact for Certain Neurological Disorders

Biogen and Sage Therapeutics, a Cambridge, Massachusetts-based pharmaceutical company focused on central nervous system disorders, have entered into a global collaboration and license agreement to develop and commercialize therapies for depression and movement disorders, in a deal worth up to $3.125 billion ($875 million upfront, $650 equity investment, and up to $1.6 billion in potential milestone payments).

Under the agreement, Biogen and Sage will jointly develop and commercialize two therapies: (1) zuranolone, an oral therapy in development for the treatment of major depressive disorder (MDD), postpartum depression (PPD), and other psychiatric disorders; and (2) SAGE-324, in Phase II development, for treating essential tremor and other neurological disorders. The companies will further define the development and commercialization strategy for zuranolone, which in addition to treating PPD and MDD, may also have potential in other psychiatric disorders including bipolar disorder and generalized anxiety disorder.

Under the agreement, Sage will receive $1.525 billion in cash to be comprised of an upfront payment of $875 million and a $650-million equity investment in Sage from the purchase of approximately 6.2 million newly issued shares of Sage common stock at a price of $104.14 per share. Should the zuranolone and SAGE-324 programs achieve certain development and commercial milestones, Sage will be eligible to receive up to approximately $1.6 billion in potential milestone payments.

In addition, Biogen will receive exclusive license to develop and commercialize zuranolone and SAGE-324 outside of the US, excluding rights to zuranolone in Japan, Taiwan, and South Korea. Biogen and Sage will share responsibility and costs for development as well as profits and losses for commercialization in the US (50% Biogen; 50% Sage). Outside the US, Biogen will be responsible for development and commercialization, excluding Japan, Taiwan, and South Korea with respect to zuranolone, and will pay Sage tiered royalties in the high teens to low twenties.

Closing of the transaction is contingent on completion of review under antitrust laws, including the Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976 in the US, and other customary closing conditions. The transaction is expected to close by the end of January 2021.

Source: Biogen and Sage Therapeutics

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