SAGE Therapeutics’ Zurzuvae Sales Exceed Expectations but Uncertainties Prompt Hold Rating

Analyst Uy Ear of Mizuho Securities maintained a Hold rating on SAGE Therapeutics (SAGE – Research Report), retaining the price target of $20.00.

Uy Ear has given his Hold rating due to a combination of factors surrounding SAGE Therapeutics’ recent developments. The reported sales for Zurzuvae, a key product partnered with Biogen, have notably exceeded expectations, nearly doubling consensus estimates. While this positive surprise led to a significant intraday stock price increase, there are uncertainties related to potential channel-stocking activities, which could be inflating current sales figures. Additionally, earnings projections anticipate a substantial contribution from Zurzuvae sales to SAGE’s top line in the near term.

Furthermore, the prescription trends for Zurzuvae are encouraging, with a notable increase in healthcare providers prescribing the drug, and OB/GYNs leading the way. This adoption is expected to broaden as prescribers move beyond initial trial usage. Coverage has also been progressing well, with significant access through PBMs and Medicaid, indicating favorable market penetration potential. However, the full impact of these factors on long-term sales and market adoption remains to be fully understood, justifying the Hold rating.

Ear covers the Healthcare sector, focusing on stocks such as Arcutis Biotherapeutics, Sarepta Therapeutics, and ACADIA Pharmaceuticals. According to TipRanks, Ear has an average return of 4.4% and a 36.55% success rate on recommended stocks.

In another report released yesterday, Stifel Nicolaus also maintained a Hold rating on the stock with a $20.00 price target.

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SAGE Therapeutics (SAGE) Company Description:

SAGE Therapeutics, Inc. is a clinical stage biopharmaceutical company, which engages in the development and commercialization of novel medicines to treat life-altering central nervous system. Its programs include brexanolone, which is an acute interventional treatment for postpartum depression; and SAGE-217, an oral therapy for treatment of various CNS disorders. The company was founded by Steven Marc Paul and Douglas Covey in April 2010 and is headquartered in Cambridge, MA.