Sarepta's Dystrophin Dance Continues

The FDA has asked Sarepta Therapeutics Inc SRPT to provide dystrophin data, as part of the ongoing evaluation of the eteplirsen NDA [New Drug Application]. JMP Securities’ Liisa A. Bayko reiterated a Market Underperform rating for the company, with a price target of $10.

The FDA’s request for dystrophin data as measured by western blot from 13 patient biopsies at baseline and week 48 from the ongoing confirmatory PROMOVI trial sent Sarepta’s shares surging 26 percent in aftermarket trading.

Approval Unlikely

Feedback from Sarepta suggested confidence in the new samples being consistent with what was seen in the original sample. Analyst Liisa Bayko said, however, that “our regulatory expert maintains his view that approval is highly unlikely,” giving the likelihood of approval as 10 percent.

While this may seem to be a “small victory” for Sarepta, the additional data is unlikely to be “convincing enough to cross the threshold of substantial efficacy necessary for approval,” Bayko commented. She added that an accelerated approval by the FDA could result in a “large swing in valuation” to ~$65, while the downside is at ~$5, which is near cash.