Sage Therapeutics Drug's Failure in Huntington's 'Not Surprising,' RBC Says

Top Wall Street analysts changed their outlook on these top names. For a complete view of all analyst rating changes, including upgrades and downgrades, please see our analyst ratings page.

• RBC Capital analyst Brian Abrahams upgraded Sage Therapeutics, Inc. from Underperform to Sector Perform and maintained the price target of $4. Sage Therapeutics shares closed at $4.91 on Wednesday. See how other analysts view this stock.
• Morgan Stanley analyst James Faucette upgraded the rating for EVERTEC, Inc. from Underweight to Equal-Weight and raised the price target from $33 to $35. Evertec shares closed at $34.84 on Wednesday. See how other analysts view this stock.
• Citigroup analyst Spiro Dounis upgraded DT Midstream, Inc. from Neutral to Buy and raised the price target from $90 to $115. DT Midstream shares closed at $102.73 on Wednesday. See how other analysts view this stock.
• Rosenblatt analyst Catharine Trebnick upgraded Palo Alto Networks, Inc. from Neutral to Buy and boosted the price target from $390 to $425. Palo Alto shares closed at $392.89 on Wednesday. See how other analysts view this stock.
• Compass Point analyst Floris Van Dijkum upgraded Pebblebrook Hotel Trust from Neutral to Buy and maintained the price target of $17. Pebblebrook Hotel shares closed at $12.37 on Wednesday. See how other analysts view this stock.

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Sage Therapeutics’ SAGE phase II study evaluating its neuropsychiatric candidate, dalzanemdor (SAGE-718), for treating cognitive impairment (CI) associated with Huntington’s Disease (HD) failed to meet the primary endpoint.

The double-blind, placebo-controlled DIMENSION study evaluated the effects of dalzanemdor in participants with CI associated with HD.

Top-line data from the study showed that dalzanemdor failed to demonstrate a statistically significant difference from baseline compared to placebo on the Symbol Digit Modalities Test, a measure of cognitive function, at day 84. This was the primary endpoint of the study.

The stock hit its 52-week low on the pipeline setback. Year to date, shares of Sage Therapeutics have plunged 77.3% compared with the industry’s decline of 8.5%.

More on SAGE's DIMENSION Study

The analyses of secondary endpoints from the DIMENSION study also failed to demonstrate statistically significant or clinically meaningful differences in patients treated with dalzanemdor versus placebo.

Treatment with dalzanemdor was generally well-tolerated and no new safety signals were reported.

Following the disappointing data from the DIMENSION study, SAGE decided to stop further development of dalzanemdor.

The company also decided to stop the ongoing PURVIEW study, which is an open-label safety study evaluating dalzanemdor for treating participants with HD.

An inherited disorder, HD, causes nerve cells (neurons) in brain parts to gradually break down and die. CI is one of the most under-recognized aspects of HD. Currently, no treatment options are available to improve HD-related cognitive effects.

SAGE's Earlier Setback in the Development of Dalzanemdor

Last month, Sage Therapeutics announced that the phase II LIGHTWAVE study, which evaluated dalzanemdor for treating mild cognitive impairment (MCI) and mild dementia in Alzheimer’s Disease (AD), failed to meet the primary endpoint.

Following this, the company decided to stop further development of dalzanemdor for the AD indication.

Previously, dalzanemdor failed in the phase II PRECEDENT study, which investigated the candidate in patients with MCI associated with Parkinson’s disease (PD).

SAGE has stopped further development of dalzanemdor for the PD indication as well.

Owing to the string of pipeline setbacks related to the development of dalzanemdor, SAGE decided to stop the development of the candidate for all the indications.

SAGE's Zacks Rank & Key Picks

Sage Therapeutics currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the biotech sector are Immunocore Holdings plc IMCR, Spero Therapeutics, Inc. SPRO and Castle Biosciences, Inc. CSTL, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, estimates for Immunocore’s 2024 loss per share have narrowed from $1.79 to 94 cents. Loss per share estimates for 2025 have narrowed from $2.35 to $1.57 during the same time. Year to date, shares of IMCR have declined 52.6%.

IMCR’s earnings beat estimates in two of the trailing four quarters while missing the same on the remaining two occasions, the average surprise being 25.57%.

In the past 60 days, estimates for Spero Therapeutics’ 2024 loss per share have narrowed from $1.59 to $1.13. Loss per share estimates for 2025 have narrowed from $1.54 to 54 cents during the same time. Year to date, shares of SPRO have declined 18.3%.

SPRO’s earnings beat estimates in two of the trailing four quarters while missing the same on the remaining two occasions, the average surprise being 94.42%.

In the past 60 days, estimates for Castle Biosciences’ 2024 loss per share have narrowed from 58 cents to 8 cents. Loss per share estimates for 2025 have narrowed from $2.13 to $1.88 during the same time. Year to date, shares of CSTL have surged 31.8%.

CSTL’s earnings beat estimates in each of the trailing four quarters, the average surprise being 172.72%.

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