Sarepta Therapeutics Stock Price Cut to $0 Amid FDA Dispute

Sarepta Therapeutics' shares have been slashed to $0 by HC Wainwright & Co. analysts due to the FDA's request for voluntary action after three deaths linked to its gene therapies. Analysts view the battle with the FDA as "unwinnable" and expect the FDA to require removal of Elevidys from the market. The average 12-month target among analysts covering the stock is $30.41, but Kapoor believes the company's value has been wiped out.

Sarepta Therapeutics, Inc. (NASDAQ: SRPT) has been embroiled in a significant regulatory dispute with the U.S. Food and Drug Administration (FDA) following the deaths of three patients linked to its gene therapies. The FDA requested a voluntary halt to the shipment of Elevidys, Sarepta's approved gene therapy, but the company refused, setting the stage for a major regulatory clash with severe implications for both patients and investors.

The FDA placed Sarepta's investigational gene therapy clinical trials for limb girdle muscular dystrophy (LGMD) on a clinical hold due to serious safety concerns, including three patient deaths potentially linked to these products. This decision stemmed from the FDA's determination that study participants faced or would be exposed to an unreasonable and significant risk of illness or injury. The FDA also requested a voluntary halt to all shipments of Elevidys, but Sarepta refused, asserting that its "comprehensive scientific interpretation of the data... shows no new or changed safety signals in the ambulant patient population" [1].

The FDA revoked the platform technology designation for Sarepta's AAVrh74 Platform Technology, which is used in multiple gene therapies, including Elevidys. This designation was rescinded because the preliminary evidence was deemed insufficient to demonstrate that the technology could be incorporated into or utilized by multiple drugs without adverse effects on safety. The FDA has notified Sarepta that Elevidys's indication should now be restricted solely to ambulatory patients [1].

Sarepta's shares have been slashed to $0 by HC Wainwright & Co. analysts due to the FDA's request for voluntary action. Analysts view the battle with the FDA as "unwinnable" and expect the FDA to require the removal of Elevidys from the market. The average 12-month target among analysts covering the stock is $30.41, but Kapoor believes the company's value has been wiped out [2].

Sarepta plans to submit the findings of an expert panel and a proposed protocol to the FDA. They will also discuss a proposal to collect additional data on a modified treatment regimen in a new cohort of the ENDEAVOR study. This is intended as a pathway to re-establish dosing for non-ambulant patients in the future [1].

The FDA is continuing its investigation into the risk of acute liver failure associated with gene therapies employing Sarepta's AAVrh74 Platform Technology and is prepared to take further regulatory actions as necessary. Despite the FDA's stance, Sarepta continues to ship Elevidys to the ambulatory patient population.

The ongoing regulatory battle and the company's refusal to halt shipments of Elevidys have led to a significant drop in Sarepta's stock price. As of Monday's premarket session, Sarepta's stock was down 6.79% at $13.12, reflecting the ongoing concerns and market reaction to these significant developments [1].

References:
[1] https://finance.yahoo.com/news/sareptas-shocking-stand-company-rejects-114515139.html
[2] https://www.investors.com/news/technology/sarepta-stock-elevidys-gene-therapy-fda-request/?mod=newsviewer_click&refcode=aflMarketWatch&src=A00619