Sarepta Scores Big on Highly Contested FDA Approval
Sarepta Therapeutics Inc. (NASDAQ: SRPT) is clearing another hurdle related to its Duchenne muscular dystrophy (DMD) treatment, eteplirsen. The stock practically doubled on Monday following the U.S. Food and Drug Administration (FDA) approval.
As we have said before, FDA decisions can make or break companies in the biotech or pharmaceutical fields. Check out some other key decisions coming in the next two months.
According to an FDA announcement, eteplirsen has now been rebranded as Exondys, and with the FDA Accelerated Approval program, it is available for sale within the United States. However, some requirements still need to be met in this program. Sarepta must conduct another clinical trial to support company claims.
As this trial is ongoing, Sarepta will be able to market and sell its DMD treatment, but should the drug not meet the prescribed results for the trial, the FDA retains the right to pull its approval for Exondys.
There was already a fair amount of optimism surrounding Sarepta’s appeal after one of eteplirsen’s key critics left the FDA. Dr. Ronald Farkas was the lead on a critical review of eteplirsen, but it was reported last week that he would be leaving this position. Previously, the Wall Street Journal had reported that Farkas was the most vocal critic of this drug, although he is not the only member of the 13-person committee that has concerns on it. It appears that all this positive sentiment was well founded.
Apart from this, the stock has been under fire from analysts and investors over the course of 2016, getting the worst of it from the FDA. Excluding Monday’s move, the stock is down 27% year to date, as well as down roughly 30% in the past 52 weeks. However, in just the past quarter and half, the stock is up 62% and 56%, respectively.
Short interest for Sarepta in the most recent period decreased to 14.80 million, with eight days to cover, from the previous level of 16.20 million. We might expect a big shift in this number on the next settlement date.
Shares of Sarepta traded up over 98% at $55.84 early Monday, with a consensus analyst price target of $22.75 and a 52-week trading range of $8.00 to $55.25.