Citi: Sarepta Therapeutics Will See Competition, Concern Over FDA Delay

Published: Oct 27, 2014

Citi: Sarepta Will See Competition, Concern Over FDA Delay

October 27, 2014

By Riley McDermid, Breaking News Sr. Editor

Monday’s news that the U.S. Food and Drug Administration has put Sarepta Therapeutics ’s muscular dystrophy drug on ice while it seeks more information is just one more sign that the drug, eteplirsen, has a difficult road ahead, said an analyst with Citigroup today.

Sarepta said the new FDA request came out of a planned New Drug Application (NDA) submission for the approval of eteplirsen for the treatment of Duchenne muscular dystrophy (DMD). The FDA is now asking Sarepta for the results from an independent assessment of dystrophin images and the 168-week clinical data from study 202.

Yaron Werber, head of the biotech analysis team at Citigroup, said the news was not wholly unexpected to followers of this particular drug’s progress.

“We view this morning's announcement of further unexpected FDA requests relating to eteplirsen's NDA to support our thesis that FDA is not comfortable with eteplirsen's data. We completely understand the level of unmet need facing DMD boys,” he wrote in a note to investors. “However, Sarepta's path was always aggressive and incorporated short cuts that were not employed by other competing companies in the DMD space.”

The regulator is also asking for specific data detailing the minimum duration of safety in new patients exposed to eteplirsen, patient-level natural history data to be obtained by Sarepta from independent academic institutions, and MRI data from a recent study conducted by an independent academic group.

Werber said Citi views that news as “a sign that FDA has reservations” about whether the data has shown that eteplirsen is an effective drug.

“What is most concerning to us is that FDA has communicated to Sarepta that it found inconsistencies in the dystrophin data as this is key to the NDA,” he said. Citi reiterated that although the stock is down, its analysts do not see any reason to take advantage of the weakness due to lack of “meaningful catalysts ahead,” including possible competition from drugs like Prosensa.

“As completion of the NDA is now delayed to mid-2015, there is some risk that the competitive field will shift given that Prosensa will complete its rolling NDA by year end 2014,” wrote Werber. “So this delay could have consequences depending on the outcome of the FDA review of Prosensa.”

More concerning, Werber said, is the relationship Sarepta is forming with the FDA, after some well-publicized internal concerns have leaked.

“Today's announcement adds to our level of unease with this relationship given that FDA has now returned with a long series of new requests that is designed to provide the agency with a sizable body of new data with which to evaluate the drug,” he concluded in his note. “More important, it also now delays the time to market and buys FDA more time for the field to develop.”

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