Sarepta Who? This DMD Drugmaker Might be a Better Buy for Investors

May 20, 2016
By Mark Terry, BioSpace.com Breaking News Staff

It’s been a particularly tough year for companies focused on developing drugs for Duchenne Muscular Dystrophy (DMD). Investors are currently waiting for next week’s decision by the U.S. Food and Drug Administration (FDA) on whether to approve Cambridge, Massachusetts-based Sarepta Therapeutics eteplirsen.

But earlier this year, the FDA turned down San Rafael, California-based BioMarin Pharmaceutical ’s application for Kyndrisa for DMD. In January, Cambridge, Massachusetts-based Akashi Therapeutics halted its DMD trial for HT-100 because one of the patients developed serious, life-threatening health problems.

Todd Campbell, writing for The Motley Fool, suggests investors take a look at another company, PTC Therapeutics and its DMD drug, Translarna, which received conditional approval in 2014 in Europe. In 2015, Translarna brought in $33.7 million, and in this year’s first quarter reported $18.9 million in sales, a 49 percent increase from the fourth quarter.

DMD is a muscle wasting disease caused by mutations in the dystrophin gene. Those mutations result in a lack of production of the dystrophin protein. The disease is progressive and typically causes death in early adulthood with serious complications that include heart or respiratory-related problems. DMD mostly affects boys, about 1 in every 3,500 to 5,000 male children.

Although currently not available in the U.S., PTC Therapeutics is in talks with the FDA regarding the drug. And Translarna sales might rise if PTC can get pricing deals with other European Union member countries, as well as other markets, such as the Americas. The U.K.’s National Institute for Clinical Excellence (NICE) recommended the drug for ambulatory patients ages five year and older with nonsense mutation DMD just last month. If the contract negotiations come together, the drug will soon be available in the U.K.

“Even if Translarna can’t secure approval in the U.S., there’s enough potential growth in other markets to drive PTC Therapeutics’ revenue higher,” writes Campbell. “As of January, Translarna was being used to treat 206 patients and management estimates that the target market for ambulatory DMD patients outside the U.S. is 2,000 patients.”

The drug is also being evaluated in a Phase III study in cystic fibrosis patients with nonsense mutations. If that label expansion occurs, there would another possible 14,000 patients worldwide.

Meanwhile, Sarepta’s FDA fate is hard to predict. The entire process has been emotional and political, with 12-hours of discussions and presentations by experts, patients, and families. In March, 36 experts in DMD signed a letter to the FDA urging it to approve the drug. The letter was written by two co-directors of the Center for Duchenne Muscular Dystrophy at UCLA, M. Carrie Micelli and Stanley Nelson. In February, 109 members of Congress sent a letter to the FDA urging it to accelerate approval of a DMD drug—apparently any DMD drug.

The biggest problem with the Sarepta drug is the size of the study and lack of placebo controls. The study only involved 12 boys, and the data on two them, who did not respond to the drug, was essentially disregarded by Sarepta, which claimed that they weren’t expected to respond because they were at a later stage of the disease. There was no real placebo controls to compare the results to, using data from older European studies.

The 7 to 6 vote indicates that seven of the panel members didn’t believe the trial showed the drug worked. That doesn’t mean they didn’t think it worked—it means they didn’t think Sarepta’s clinical trials proved that it works.

Campbell writes, “Even if the FDA gives Sarepta Therapeutics the go-ahead on eteplirsen, the company will probably have to conduct a pricey confirmatory trial and fund launch expenses. If it rejects eteplirsen, then Sarepta would need to conduct an expensive Phase III study in order to get that data that might allow it to refile for approval later.”

Or Sarepta could throw up its hands and give up on the drug to focus on something else.