Solid Biosciences Snags Bullish Initiation As It Develops Gene Therapy For Muscular Dystrophy

The young biotech firm Solid Biosciences Inc SLDB secured two Buy ratings Tuesday and another Wednesday.

The Rating

Chardan Capital analyst Gbola Amusa initiated Solid Biosciences with a Buy rating and $40 price target.

The Thesis

Amusa expects gene therapies to penetrate 26.8 percent of the 2025 U.S. market for Duchenne muscular dystrophy, and by his assessment, Solid Biosciences’ SGT-001 is poised to seize 52.5 percent of that share of the treatment space. (See the analyst's track record here.) 

Preclinical data in non-human subjects demonstrated microdystrophin expression between 10 percent and 50 percent of “normal." A 5-percent level generally signals a meaningful increase.

Considering the candidate’s AAV9 vector, muscle-specific promoter, superior microdystrophin and strong early data, Amusa ranks SGT-001 above competing treatments from both Pfizer Inc. PFE and Sarepta Therapeutics Inc SRPT, the latter of which secured FDA approval for its Exondys 51 on dystrophin increases of less than 1 percent.

Assuming a SGT-001 price of $2.1 million at its 2023 launch with 1.5-percent growth each year, Chardan anticipates peak sales of $1.962 billion in 2025.

Solid Biosciences is expected to release data for SGT-001 by the first half of 2019. Risks include the FDA’s partial clinical hold on high-dose manufacturing, as well as the AAV9 delivery method, which may delay the launch or require royalties payments, according to Chardan Capital. 

Price Action

At the time of publication, shares were set to open at $23.86.

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