Sarepta Therapeutics, Inc. (NASDAQ: SRPT)
On Friday the stock of Sarepta Therapeutics, a biopharmaceutical company with one of the two leading drug candidates to treat Duchenne Muscular Dystrophy (DMD), imploded on a scathing review from the Food and Drug Administration. The FDA briefing was harshly critical of the safety and effectiveness of Sarepta’s drug candidate, eteplirsen.
Sarepta Therapeutics Outlook
The FDA briefing was released ahead of an advisory committee meeting scheduled for Friday, January 22. While the briefing is not a final decision, it does set the tone for the upcoming meeting. The biggest challenge for SRPT continues to be the small size of the eteplirsen study group with only 12 patients. That coupled with the fact that efficacy data was significantly below endpoint targets, makes it difficult to criticize the FDA comments. However DMD patient and family support groups plan to attend the advisory meeting and they will make an impassioned plea for the FDA to approve eteplirsen. DMD, a debilitating muscle disease for which there is currently no treatment, afflicts many thousands of young boys. The FDA has “significant concerns” about the company’s trial design, efficacy and statistical analysis, Leerink Swann analyst Joseph Schwartz told investors. While the review does not appear to raise safety issues, “the data set is too small to provide complete confidence that problems won’t occur in a large number of patients,” Schwartz wrote in a research note. Yahoo Finance
SRPT Technical Analysis
Friday’s FDA news quickly sent SRPT down 60% to a low of $12.80. After the initial flush, the stock found footing around the $14 level and spent the day grinding sideways before closing at $14.28. The big move happened on 11 times average daily volume. Both the high of the day of $15.87 and the $12.80 low were put in during the first 15 minutes of trading when volume was spiking. SRPT last saw these levels in May 2015. That marked the end of a five-month run when SRPT traded in a range between $12 and $15.70. During the coming week, the stock could offer some reasonable risk-reward setups within this range, but I will be watching for a reaction to the advisory committee meeting and the subsequent final decision from the FDA.
Sarepta Company Profile
Sarepta Therapeutics, Inc. is a biopharmaceutical company. The Company is focused on the discovery and development of unique ribonucleic acid (RNA-targeted therapeutics for the treatment of rare, infectious and other diseases. The Company is primarily focused on advancing the development of its potentially disease-modifying Duchenne Muscular Dystrophy (DMD) drug candidates, including its lead DMD product candidate, eteplirsen, which is an antisense PMO therapeutic in Phase III clinical development for the treatment of individuals with DMD who have an error in the gene coding for dystrophin that is amenable to skipping exon 51. The Company is also developing therapeutics using its technology for the treatment of drug-resistant bacteria and infectious, rare and other human diseases. Google Finance