Biotech Sarepta Therapeutics (SRPT) said Monday that the FDA sent it detailed guidelines for testing its muscular-dystrophy drug after a previous rejection, leading Sarepta to believe it can file for approval again by the end of the year. Sarepta’s stock was up nearly 50% in midday trading on the stock market today, near 36, a five-month high.
Last year, Sarepta attempted to win accelerated approval for the drug, eteplirsen, based on a study tracking 12 boys with the rare degenerative disease known as Duchenne muscular dystrophy. In November, the FDA said the filing was “premature,” knocking down Sarepta’s previously highflying stock by more than 60%.
The new FDA letter said that the earlier study, which evaluated patients’ performance on a six-minute walk test, “could be considered a finding on an intermediate clinical endpoint that could have the potential to support accelerated approval,” but they had concerns related to the interpretation of the data that Sarepta said it will address in the review.
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The FDA also said it was possible to use biopsies measuring dystrophin levels as a way to gauge the effectiveness of the drug. Sarepta said it will launch further studies evaluating this, as well as a larger study to confirm the results of the earlier one.
JMP Securities upgraded the stock to outperform, while Needham and Piper Jaffray both lifted their price targets. Leerink analyst Joseph Schwartz was more cautious.
“The FDA has shown a willingness to be patient and wait for more compelling/controlled data before approving eteplirsen, so we see the risk that the FDA continues to do so beyond the first filing at year-end,” he wrote in a research note.
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