Biotech is a tough industry to invest in. It can be immensely rewarding … or money-flushing and soul-crushing.

Unfortunately, Sarepta Pharmaceuticals Inc (SRPT) stock looks primed to be a money-flusher.

The Food and Drug Administration advisory committee voted yesterday against recommending that the FDA approve eteplirsen, Sarepta’s Duchenne muscular dystrophy (DMD) drug.

While that doesn’t guarantee the FDA won’t approve eteplirsen, it’s very rare for the regulatory agency to go against the advice of the advisory committee, which is composed of experts in the field. That’s horrible news for SRPT stock, which is down more than 30% on the news.

Abandon SRPT Stock Before it Gets Worse

The market is indeed ditching SRPT stock en masse today, although shares have actually fought back throughout the day. After closing at $14.95 on Monday, shares opened at $8.06, down 46% overnight.

Maybe the bounce higher (shares are trading around $10 as I write this) is due to shorts covering their positions, buying back SRPT stock to lock in gains. It’s very likely that accounts for some of the rebound; through the end of March, 18.1 million shares of SRPT stock were sold short, and at its average daily volume of roughly 3 million shares, it would take 6 trading days for all shorts to cover their positions.

But still others are likely buying Sarepta because they believe a rebound is in order. Please, do not do that.

The PDUFA date for eteplirsen is May 26, which means the FDA has to make its official ruling on the drug by then. Given what Oppenheimer said was an “unambiguously negative” advisory committee ruling, analysts are cutting their ratings, slashing their SRPT stock price targets, and generally anticipating the worst.

Oppenheimer was forced to attempt to save face by erasing its $60 price target and downgrading Sarepta shares from “Outperform” to “Market Perform”; Piper Jaffray downgraded SRPT to “Underweight” and slashed the price target to $6 per share from $15 per share; SunTrust Robinson Humphrey also downgraded the stock and cut the price target to $4/share.

You don’t want to bet on a comeback.

Sarepta’s catalyst is gone, plain and simple. Even after the selloff, it’s a $460 million company with revenue of $1.25 million last year. Reading Sarepta’s annual report will give you some idea of how desperately it needs eteplirsen to get approved and go to market:

“We have not generated any revenue from product sales to date and there can be no assurance that revenue from product sales will be achieved. Even if we do achieve revenue from product sales, we are likely to continue to incur operating losses in the near term.”

So what was that $1.25 million in revenue SRPT reported in 2015?

“In the periods presented in this report, substantially all of our revenues were derived from research and development contracts with and grants from the U.S. government.

Eteplirsen is the only Phase III drug SRPT has in its pipeline, and is far and away the company’s most important potential catalyst. The next-furthest-along product is DMD EXON 53 (SRP-4053), which is a Phase II drug right now.

In 2015, Sarepta spent over $72 million in R&D expenses on eteplirsen, and only $5.6 million working on DMD EXON 53. It’s clear how significant eteplirsen is to the company.

The R&D spend is another issue: While SRPT stock won’t go to zero if eteplirsen is rejected by the FDA, Sarepta had about $204 million in cash at the end of 2015, which is a concern given the $146 million SRPT spent on R&D last year.

Bottom line? I know it hurts to take a loss, and yes, there’s still a very slim chance the FDA could approve eteplirsen within  the next month … but don’t take a flier. The likely outcome is clear, and cutting your losses is the smartest thing an investor can do right now.

If you haven’t already, sell Sarepta stock, take that money and look for another opportunity. There are far, far better options.

As of this writing, John Divine did not hold a position in any of the aforementioned securities. You can follow him on Twitter at @divinebizkid or email him at editor@investorplace.com.