A lot of people doubted Sage Therapeutics (SAGE) - Get Report last summer when the company's experimental drug SAGE-547 erased severe depression in four new mothers diagnosed with postpartum depression. The sample size was too small to draw any real conclusions about the drug, critics said.

On Tuesday, Sage announced remarkable results from a slightly larger and placebo-controlled phase II study in postpartum depression which confirms the positive findings from one year ago.

Seventy percent of women with severe postpartum depression treated with an injection of SAGE-547 achieved complete remission (no more depression) after 60 hours compared to just under 10% of women treated with a placebo injection.

Moreover, the complete remission seen in the mothers treated with SAGE-547 remained durable out to 30 days.

"These are some of the most important findings in postpartum depression to date... with a new [drug] mechanism," said Sage CEO Jeff Jonas, reached by phone early Tuesday morning.

Sage's stock price increased 43% to $47.96 per share in Tuesday trading.

In the phase II study, 21 women with postpartum depression were randomized equally to receive a 60-hour infusion of SAGE-547 or a similar placebo infusion. In clinical trials, depression is measured using an assessment known as the Hamilton Ratings Scale for Depression (HAM-D). When the 21 women entered the Sage phase II study, their mean HAMD score was 28, meaning they were all suffering from severe depression.

After 60 hours, the women treated with SAGE-547 had a 20-point reduction in their HAM-D score, or more than 12 points greater than the women receiving placebo injections. This difference was highly statistically significant and achieved the primary endpoint of the study.

The benefit of SAGE-547 over placebo on the HAM-D scale was durable out to 30 days, remaining statistically significant, Sage said.

When a HAM-D score dips to 7 or below, a patient is said to be in complete remission, meaning depressive symptoms are gone. In the Sage study, seven of the 10 women treated with SAGE-547 achieved a complete remission at 60 days. At 30 days, the same 70% of women remained in complete remission. By comparison, just one of the 11 women treated with placebo achieved a complete remission at 60 hours. Two women in the placebo arm were in complete remission at 30 days.

Treatment with SAGE-547 was well tolerated with no serious adverse events or discontinuations reported.

SAGE-547 is a hormone which agonizes, or activates, neurotransmitter receptors called GABA in the brain. Sage believes the specific and differentiated ways in which SAGE-547 targets the GABA receptor explains the drug's potential benefit against a list of central nervous system diseases, including epilepsy, movement disorders, postpartum depression and anxiety.

Heading into Tuesday's results, Sage bears argued that SAGE-'547 was similar to the class of old psychoactive drugs known as benzodiazapenes, which also work against the GABA receptor but have not proved to be particularly effective in depression (as a monotherapy) and are not used to treat postpartum depression.

Postpartum depression was a really interesting test case for SAGE-547 because there's a body of scientific research which says the disease is different from major depressive disorder in that it is caused by the rise and fall of certain hormones during pregnancy and after birth. These roller-coastering hormones, in turn, cause the GABA system to get out of whack. The hypothesis is that SAGE-547 "adds back" these falling hormones and normalizes the GABA receptors so that the postpartum depression disappears.

The positive results from the phase II study support Sage's hypothesis about SAGE-547. Looking ahead, the company is starting an expansion study looking at different doses of SAGE-547 and also enrolling women with moderate and severe postpartum depression.

Sage's CEO Jonas says the data from the expansion study, if positive, will be shared with regulators to determine if they are suitable for approval filing.

The company estimates that approximately 125,000 cases of severe postpartum depression are diagnosed each year in the U.S.

SAGE-547 is also being run through a phase III study of patients with an extra-severe form of epilepsy known as super-refractory status epilepticus. Results from that study are expected in the second half of the year.

Sage is also moving ahead with development of SAGE-217, an oral version of SAGE-547.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.