Here’s Why Sarepta Therapeutics Inc Is Up 80% Today (SRPT)

Sarepta Therapeutics Inc (NASDAQ:SRPT) shot up 80% on Monday to lead just about everything else on Wall Street. The catalyst for the move is the U.S. Food and Drug Administration’s approval of Sarepta’s eteplirsen injection drug.

Here's Why Sarepta Therapeutics Inc Is Up 80% Today (SRPT)Eteplirsen, otherwise known as Exondys 51, has been approved for the treatment of Duchenne muscular dystrophy, particularly in patients with a rare form of DMD.

The FDA’s Center for Drug Evaluation and Research director, Janet Woodcock, had this to say:

“Patients with a particular type of Duchenne muscular dystrophy will now have access to an approved treatment for this rare and devastating disease. In rare diseases, new drug development is especially challenging due to the small numbers of people affected by each disease and the lack of medical understanding of many disorders. Accelerated approval makes this drug available to patients based on initial data, but we eagerly await learning more about the efficacy of this drug through a confirmatory clinical trial that the company must conduct after approval.”

The clinical trial Woodcock is referring to is a condition of the FDA approval where Sarepta will have to hold a randomized two-year trial to determine just how effective the drug is as a treatment. From the Department of Health and Human Services:

“If postmarketing clinical trials fail to verify clinical benefit or are not conducted with due diligence, we may, following a hearing in accordance with 21 CFR 314.530, withdraw this approval.”

Winning FDA approval had been an uphill battle for SRPT, as the efficacy of the drug was hotly debated for months leading up to today’s decision.

Mainly, opponents of the treatment questioned the drug’s ability to produce the protein dystrophin, needed to keep muscle fibers from degenerating. Also in question was a 12-patient clinical trial used by SRPT, as the company did not test the treatment in a larger, placebo-controlled group per the FDA’s requests. For these reasons, the drug was deemed ineffective and failed to meet approval in April of this year.

Today’s decision in the affirmative has buoyed the prospects of other biotech companies with Duchenne treatments on the horizon, such as PTC Therapeutics, Inc. (NASDAQ:PTCT), which is up 23%, and Summit Therapeutics PLC (ADR) (NASDAQ:SMMT), up 14.6%.

As of this writing, John Kilhefner did not hold a position in any of the aforementioned securities.

More From InvestorPlace

Article printed from InvestorPlace Media,

©2021 InvestorPlace Media, LLC