Goldman Sachs Initiates SAGE Therapeutics At Buy On 'Great' Orphan Drug Potential

In a report published Friday, Goldman Sachs analysts initiated coverage of

with a Buy rating and price target of $80. The analysts believe that the company has a favorable risk/reward provide that could see significant upside. "The lead product SAGE-547 is being developed for super-refractory status epilepticus (SRSE), a rare and severe seizure condition with a very high unmet need and high morbidity/mortality rate," the analysts said. Although the drug is still in the early stages of development, it has already provided robust and compelling Phase 1 and 2 data, with high Phase 3 visibility, which suggests the possibility of success. Phase 3 trials are expected to begin in mid-2015, with data expected in later 2016 or early 2017. The company is likely to file for the drug in 1H17 and potential approval and launch are expected in 2018. According to the Goldman Sachs report, "We also think the commercial opportunity is substantial with very positive physician feedback pointing to the potential for rapid adoption in the targeted patient population given the nature of the condition and the lack of viable alternatives." The analysts also believe that SAGE Therapeutics' extended pipeline is currently underappreciated and offers considerable optionality in the stock. Given the company's experienced management team and the increased interest in the orphan drug segment in recent times, SAGE Therapeutics is likely to continue to attract investors.