Sarepta Loses A Third Of Its Value On Failed Tests, Gene Therapy Outlook

Core Viewpoint - Sarepta Therapeutics experienced a significant decline in stock value following a mixed third-quarter report, which included two drug failures and delayed test results, despite a sales beat [1][4]. Drug Approvals and Performance - Sarepta plans to request traditional FDA approval for Amondys 45 and Vyondys 53 based on positive risk-benefit evidence for treating Duchenne muscular dystrophy, although both drugs failed confirmatory studies [2]. - The confirmatory studies were affected by the Covid pandemic, but excluding those patients, the drugs showed a 30% reduction in disease progression over two years [5]. Financial Performance - Sarepta's sales for Elevidys, a gene therapy for Duchenne muscular dystrophy, reached $131.5 million, surpassing expectations of $109 million to $115 million, although year-over-year sales fell [7]. - Overall sales for the company were $399.4 million, exceeding analyst forecasts of $336 million, but represented a 15% decline year-over-year [8]. Analyst Insights - Analysts express concerns about the potential for increased reimbursement pressure due to the missed confirmatory testing and ongoing uncertainty regarding FDA leadership [3][6]. - Despite a better-than-expected adjusted loss of 13 cents per share compared to the anticipated 32-cent loss, the outlook remains uncertain due to various challenges [9]. Future Developments - Sarepta has delayed timelines for expected readouts from studies in partnership with Arrowhead Pharmaceuticals, now anticipating initial test data in the first quarter [10]. - The company plans to make a $200 million milestone payment to Arrowhead in the fourth quarter [10].