Sarepta Rockets After the FDA Delays Ruling on DMD Drug
May 25, 2016
By Mark Terry, BioSpace.com Breaking News Staff
Tomorrow’s the date investors in Sarepta Therapeutics were waiting for—a final decision by the U.S. Food and Drug Administration on its eteplirsen for Duchenne Muscular Dystrophy (DMD). But Sarepta announced today that the FDA told the company it would miss the May 26 deadline because “they are continuing their review and internal discussions related to our pending NDA for eteplirsen.”
Apparently investors interpreted that to mean the drug might be approved, with Sarepta popping at the news. Shares traded on April 26 for $11.02, rose to $18.44 on May 24, and is currently trading for $21.46.
DMD is a muscle wasting disease caused by mutations in the dystrophin gene. It is a progressive disease that usually causes death in early adulthood, with serious complications that include heart or respiratory-related problems. It mostly affects boys, about 1 in every 3,500 or 5,000 male children.
The saga of Sarepta and eteplirsen has been dramatic, if nothing else. Back in January, the FDA was scheduled to review the New Drug Application (NDA) for eteplirsen, but postponed it in light of a pending snowstorm on the east coast. It was rescheduled for April 25.
In March, 36 DMD signed a letter to the FDA urging it to approve eteplirsen. The letter was written by Carrie Miceli and Stanley Nelson, co-directors of the Center for Duchenne Muscular Dystrophy at UCLA. The letter brought up two specific issues. The first was whether the patients’ disease progression on eteplirsen substantially deviated from the expected course of the disease in a sufficiently reliable manner. The second question was, did the drug show “convincing evidence of dystrophin protein induction, the proposed mechanism of action of the drug?”
The doctors argued that the data was “clearly supportive of accelerated approval.”
To bring in a political element, in February, 109 members of Congress sent a letter to the FDA urging it to accelerate approval of a DMD drug, not specifying eteplirsen, but pretty much any DMD drug.
The primary concern over the drug is the size of the clinical trial, which really only studied 12 patients with no control group. The majority of the advisory committee didn’t believe the trial showed the drug worked. That doesn’t mean they didn’t think it didn’t—it means they didn’t believe the trial did a good job of proving it.
“The data wasn’t there to approve on the basis of one poorly controlled trial,” said Caleb Alexander, a researcher at the Johns Hopkins Bloomberg School of Public Health, and chair of the panel.
The April meeting was something of a media circus. It went on for 12 hours and had 52 public commentators, often offering emotional pleas for help, including several boys with DMD and their parents. Of the 52 public speakers, 51 urged approval.
Although some investors viewed the delay as promising, analysts preached caution, noting that BioMarin Pharmaceuticals ’ also had a delay before its DMD drug, Kyndrisa, was rejected. Simos Simeonidis, an analyst with RBC Capital Markets, wrote in a note to clients this morning, that the delay is “extending the agony (and the hope) in DMD. We continue to see only a small chance of an approval.”
There has been a lot of talk on, if the FDA turns the drug down this time, Sarepta will walk away. The heart of the FDA’s criticism has been over the structure and size of the clinical trial, not the drug itself, but continuing a larger trial would take time and money. Another trial could probably bring in useful data by the second half of 2017.
“It sounds tough, yes, it sounds very tough,” said Ritu Baral, an analyst with Cowen & Co., to Bloomberg. “When there are investors who believe in the activity and investors that believe there’s a market, there’s always a price.” But, Baral added, “It’s a vanishingly small probability that they will walk away from this drug.”
At the end of March, Sarepta had $141 million in cash and equivalents, a decrease of $63 million from the beginning of the year. Its 2015 operating loss was $220 million.
On a broader level, the FDA decision could set a precedent for how the agency handles clinical trials for rare diseases where there is significant unmet need. From the scientific perspective, the agency—and patients—want approved drugs to be effective, reliable and safe, and they need to be scientifically proven through rigorous clinical trials. On the other hand, it’s not hard to understand how parents of children with this disease would want access to any drug that has even a slim chance of delaying or treating the disease, which comes with a death sentence.
“It’s not a situation where desperate parents are hoping for an approval,” said Carrie Miceli, to Bloomberg, “it’s a situation where educated people are hoping for a path” for these types of complicated drug approvals. “If the FDA doesn’t hear that voice it will beg the question of how they hear the voice of the public.”