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United States securities and exchange commission logo
July 23, 2020
Kimi Igluchi
Chief Financial Officer
Sage Therapeutics, Inc.
215 First Street
Cambridge, MA 02142
Re: Sage Therapeutics,
Inc.
Form 10-K for the
Fiscal Year Ended December 31, 2019
Filed February 27,
2020
File No. 001-36544
Dear Ms. Igluchi:
We have limited our review of your filing to the financial
statements and related
disclosures and have the following comments. In some of our comments, we
may ask you to
provide us with information so we may better understand your disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 10-K for the Fiscal year Ended December 31, 2019
Notes to Consolidated Financial Statements
Cost of Goods Sold, page F-10
1. You disclose that
certain manufacturing costs associated with product shipments of
ZULRESSO were expensed
prior to FDA approval and, therefore, were not included in
cost of goods sold as
of December 31, 2019 and March 31, 2020. Please tell us and
provide proposed
disclosure to be included in future periodic reports that addresses
the following:
The cost of the
inventory build-up prior to your regulatory approval that had been
expensed in prior
periods as research and development expenses (i.e. zero cost
inventories),
Kimi Igluchi
Sage Therapeutics, Inc.
July 23, 2020
Page 2
The estimated selling value of zero cost inventory on hand at
March 31, 2020 and
when you expect, based on your current sales trends, the zero
cost inventories to be
depleted, and
The shelf life of your inventory and your consideration of
whether or not any
additional inventory will be determined to be obsolete in future
periods.
6. Collaboration Agreement, page F-26
2. With regards to your strategic collaboration agreement with Shionogi,
please provide the
following information so we may further evaluate your accounting. Tell
us how you
concluded:
the license is distinct and has standalone value under ASC
606-10-25-19 through 25-
22, specifically addressing ASC 606-10-25-19a. In this regard,
include in your
response if the supply of API is available from entities other
than you. Refer also to
ASC 606-10-55-368 through 55-374, Example 56.
the supply of API is an option and not a performance
obligation. Refer to ASC 606-
10-25-14 through 25-22, specifically 21c, and ASC 606-10-55-41
through 55-45 and
55-54 through 55-58.
3. Please tell us where you have filed the collaboration agreement with
Shionogi. If this
agreement was not filed, tell us how you determined the collaboration
agreement not to be
material given that you have not generated any revenues prior to the
revenue
recognized under this agreement.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
You may contact Christine Allen Torney at 202-551-3652 or Sasha Parikh at
202-551-
3627 with any questions.
FirstName LastNameKimi Igluchi Sincerely,
Comapany NameSage Therapeutics, Inc.
Division of
Corporation Finance
July 23, 2020 Page 2 Office of Life
Sciences
FirstName LastName