Sarepta did not hold an investor call for its second-quarter earnings report or provide an updated full-year revenue outlook.
Even as Sarepta’s shares are battered by patient deaths linked to its gene therapy portfolio and the surrounding FDA drama, the Massachusetts biotech still managed to outdo analyst forecasts in the second quarter.
For the three months ending June 30, Sarepta’s total revenues hit $611 million, a 68% increase from the same period last year and coming respectably ahead of consensus, which had the biotech’s revenue at $532 million. Sarepta opted not to hold an investor call for its Q2 report and did not provide an updated 2025 outlook.
William Blair noted that Sarepta’s performance in the quarter was “driven by [a] milestone payment from Roche” in conjunction with Elevidys’ approval in Japan, worth $63.5 million, instead of the gene therapy’s market performance. Indeed, while Elevidys, the company’s Duchenne muscular dystrophy gene therapy, surged 132% year-on-year to bring in nearly $282 in the quarter, it still suffered a 25% quarter-on-quarter decline.
“While the company posted a revenue beat, which translated to profitability for the quarter, we note that the results were less reliant on its product revenues,” William Blair wrote on Wednesday. Looking ahead, the analyst firm expects “lumpiness” in Elevidys’ sales in the third quarter, given the rough few months it’s had.
In March, Sarepta reported that a patient had died of acute liver failure following treatment with Elevidys. The complication is a known side effect of adeno-associated virus vectors used to deliver gene therapies. A second mortality followed months later, then, last month, news broke that Sarepta had documented a third death, but this time in a patient treated with a different investigational gene therapy for limb-girdle muscular dystrophy.
The fallout has been severe. Soon after the third death was made public, the FDA asked Sarepta to halt all U.S. shipments of Elevidys. After initially pushing back, the company eventually relented. Roche, which owns ex-U.S. rights to the gene therapy, followed suit and soon suspended deliveries to certain countries that based their domestic approvals on the FDA’s actions.
The matter has since been resolved. Last week, the FDA recommended that the voluntary hold on Elevidys shipments to ambulatory patients be lifted, but pressure on the company remains.
Sarepta CEO Doug Ingram addressed this back-and-forth with the FDA in the company’s news release on Wednesday, noting that the biotech is “very pleased” with the regulator’s decision to endorse the resumption of shipments to ambulatory patients. “We have already resumed deliveries,” Ingram confirmed.
Still, analysts at William Blair “believe the news headlines regarding the patient deaths will affect commercial interest in the near term, and we expect to see some hesitancy from patients and physicians once shipments resume,” the firm wrote. “Therefore, we think investors will be hesitant to reenter the stock until the company is able to provide updated Elevidys revenue guidance for the coming quarters.”
Jefferies, meanwhile, predicted that third quarter sales for Elevidys could be challenged given the upheavel. Sales for that period are likely to decline by half to $130 million before stabilizing.
