Sage Therapeutics (SAGE) - Get Report treated 13 patients suffering from depression with an experimental drug known as SAGE-217. After two weeks, 11 of the patients saw their depressive symptoms cut in half. In eight patients, their depression went into complete remission.

The sliver of new data, announced Monday, show enough potential to advance SAGE-217 into a placebo-controlled mid-stage study in patients with a major depressive disorder, the company said.

On that news, Sage shares rose 15.5% to $54.77.

Depression is a huge commercial market opportunity, but it's also a disease in which drugs that show impressive results in small, early studies flame out routinely before reaching the finish line.

Sage has been successful to date finding efficacy signals gleaned from very small studies in niche neuro-psychiatric indications like severe epilepsy and postpartum depression. The company has proven doubters wrong, so far.

Major depressive disorder, however, is a big-boy psychiatric disease. That makes it a lot tougher to have confidence in a study of just 13 patients without a placebo for comparison.

"For the company to believe in [SAGE-217], we wanted to see more than the typical four- or five-point reduction that you see in most placebo studies over four weeks. "We wanted to see a few remissions," said Sage CEO Jeff Jonas, in a phone call Monday. "In fact, we saw a lot more than that, and the pharmacodynamics of the response were very similar to what we observed in postpartum depression with SAGE-547."

A meta-analysis of 12 clinical trials involving Prozac, perhaps the best-known antidepressant, demonstrate a reduction in the Hamilton depression scale of 10.1 points compared to 7.5 points for placebo at six weeks. Forty-six percent of Prozac patients in the same meta-analysis achieved complete remission compared to 34% of placebo patients, according to JPMorgan analyst Cory Kasimov.

The SAGE-217 data, a reduction of 19.9 points on the Hamilton depression scale and 62% of patients achieving complete remission, compare favorably to the historical Prozac results, Kasimov says.

The caveat—and it's a big one, of course—is that the Prozac meta-analysis included data from placebo-controlled studies totaled more than 2,600 patients. Sage has data on 13 patients.

"These initial results on major depressive disorder are exciting because they suggest that the antidepressant action of neurosteroids is not limited to postpartum depression. Neurosteroids may have a much broader function in treating depression. This opens a large market for Sage," says Alfredo Fontanini, associate professor in neurobiology and behavior at Stony Brook University. Fontanini also owns shares of Sage. 

"I've been an admirer of how Sage has been able to leverage tiny pilot studies [in severe epilepsy and postpartum depression] and show them to have some predictive power, but I am taking these depression results with much more salt," says Harry Tracy, the author of Neuroperspective, an investor newsletter focused on neurological and psychiatric disease. "If allosteric GABA-A activation [the mechanism of action of SAGE-217] is such an avenue to dramatic and immediate relief in major depressive disorder, that would require a pretty drastic rethinking of how depression, and antidepressants, work."

Sage will require a lot more data on SAGE-217 in depression. The next step, Jonas says, will be to conduct a more rigorous, double-blind, placebo-controlled study involving about 50 depression patients.

Meantime, Sage continues to expect topline results from the Phase III study of SAGE-547 in super-refractory status epilepticus (a severe form of epilepsy) in the first half of this year. In the second half, Sage will have results from two trials of SAGE-547 in postpartum depression.

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.