Why Did Sarepta Therapeutics Plunge 20%?
Shares of Sarepta Therapeutics Inc (NASDAQ: SRPT) plunged more than 20 percent on Thursday after reports surfaced that the U.S. Food and Drug Administration may pressure the company to provide its Duchenne muscular dystrophy patients with at-cost access to its eteplirsen therapy on a "compassionate use."
The Street's Biotech expert Adam Feuerstein attributed this theory to an FDA announcement in which the agency detailed a new streamlined process for patients with serious diseases to gain access to yet to be approved drugs, such as Sarepta's eteplirsen.
Feuerstein argued Sarepta could be a "financial loser" if this were to be the case as the company may be required to raise "a lot more money" in order to continue overseeing its clinical trials.
Feuerstein did note it's "not clear" if this scenario will play out but investors appear to be assuming it will. He added that the FDA's spokesperson Sandy Walsh said the announcement is not related to Sarepta or eteplirsen.
"This has been in the works for a long time and is not at all related to any specific drug or any other actions," Feuerstein quoted Walsh as saying, in response to a question about a possibly link to eteplirsen. "We've been promising release of the final form for quite a while now and are pleased it is ready for physicians to use. We've said often that we were in the final stages of getting this form out."
Nevertheless, investors appear to be assuming a poor outcome for Sarepta and its drug based on the stock's performance.
Shares traded recently at $17.48, down 18.3 percent.
© 2017 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.