Sarepta Therapeutics (NASDAQ:SRPT) stock jumped about 30% overnight after the Food and Drug Administration (FDA) approved one of its gene therapies for children with Duchenne muscular dystrophy (DMD).
Peter Marks, director of the Center for Biologics Evaluation and Research, overruled three research teams and his top lieutenants in making the decision.
SRPT stock, which traded below $117 per share early on June 20, was trading at nearly $160 in pre-market trading this morning. This brought the market capitalization from $11.7 billion to nearly $16 billion.
Hope for Duchenne?
Duchenne is a type of muscular dystrophy mainly affecting boys. Symptoms begin around age 4, and by 12, most are unable to walk.
Elevidys, Sarepta’s gene therapy, is a single-dose infusion usually given to children in the early stages of the disease. The agency gave traditional approval for these patients and accelerated approval for older ones. Sarepta CEO Doug Ingram called approval “a defining moment for the Duchenne community.”
The problem is that the Phase 3 study used for the approval, called EMBARK, failed to produce statistically significant results in an assessment of motor function. In short, it’s not a cure. But Sarepta pressed for approval, saying it “alters” the course of the disease.
Marks agreed. He has been in his current position since 2016, after joining as deputy director in 2012.
Elevidys will also be controversial because of its cost, $3 million. An estimated 15,000 children and young adults are affected by Duchenne.
Roche Holdings (OTCMKTS:RHHBY) holds marketing rights to the drug in Europe and said it will seek accelerated approval there.
SRPT Stock: What Happens Next?
It’s unclear how many patients will be able to take Elevidys due to its cost. If all 15,000 patients with the syndrome were given it, the windfall would be $45 billion.
On the date of publication, Dana Blankenhorn did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
