What happened

Shares of Sage Therapeutics (NASDAQ:SAGE), a clinical-stage biotech, took flight today, after the company announced positive mid-stage trial results for its moderate-to-severe major depressive disorder (MDD) treatment, dubbed "SAGE-217."

According to the company, SAGE-217 produced a highly significant mean reduction in the Hamilton Rating Scale for Depression among patients taking the drug, compared with those receiving a placebo. The drug was also reportedly well tolerated, with only a handful of patients discontinuing its use because of adverse side effects. Sage's shares ended the day higher by a noteworthy 70% on nearly 10 times the average daily volume as a result of this clinical update. 

Rocket taking flight.

Image source: Getty Images.

So what

Not that long ago, Sage's stock took an absolute beating after its lead clinical candidate, brexanolone, missed the mark in a late-stage study for super-refractory status epilepticus. Since then, the biotech's stock has come roaring back following brexanolone's successful late-stage readouts for postpartum depression, and now, SAGE-217's strong midstage results in MDD released today. Put simply, Sage appears primed to continue heading higher in the weeks and months ahead.   

Now what

Sage plans on advancing SAGE-217 into a pivotal late-stage trial sometime next year. In the interim, investors can also look forward to the forthcoming regulatory filing for brexanolone's postpartum depression indication in early 2018. So this small-cap biotech already has multiple catalysts on the calendar heading into 2018. 

While it's normally not a smart idea to chase an emerging biotech after a sizable move, Sage may be an exception to this rule. The company recently shored up its balance sheet with a massive $345 million public offering, and the company appears to have a viable shot at bringing multiple products to market within a few short years. As such, it might be a good idea to add this red-hot biotech stock to your portfolio soon.

George Budwell has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.