It was reported that a boy in Sarepta Therapeutics clinical trial for its micro-dystrophin gene therapy for Duchenne muscular dystrophy had a serious adverse event. However, the company indicates the adverse event report was submitted erroneously.
It was reported that a boy in Sarepta Therapeutics clinical trial for its micro-dystrophin gene therapy for Duchenne muscular dystrophy (DMD) had a serious adverse event. As a result, the stock had a significant drop of about 19%. However, the company indicates the adverse event report was submitted erroneously. As a result, trading was temporarily halted.
Sarepta is best known for its Exondys 51 (eteplirsen) for DMD, which was approved for DMD in September 2016 after a lengthy and dramatic review process by the U.S. Food and Drug Administration (FDA). 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 SRP-9001-102 trial is testing the company’s micro-dystrophin gene therapy candidate in DMD. The erroneous report was submitted to the FDA’s adverse event reporting system (FAERs), a post-marketing surveillance database for therapies that have been approved.
Sarepta indicated in a statement that to date their investigation showed the submission wasn’t made by a Sarepta employee or the study’s principal investigator.
“Two weeks post-infusion, the patient presented with dark colored urine and elevated creatine phosphokinase (CK) levels but was otherwise asymptomatic. He was hospitalized for observation, discharged the following day and test results returned to baseline,” Sarepta stated.
Rhabdomyolysis is a serious syndrome related to direct or indirect muscle injury, and is a common risk associated with DMD. It can lead to kidney failure.
The trial is a one-to-one blinded study, meaning any patient showing an adverse event could either be receiving the drug or placebo. Sarepta stated, “While Sarepta and its principal investigator remain blinded to the study, the study drug safety monitoring board is unblinded to the event and has reviewed the issue and recommended the study continue uninterrupted. No stopping rule in Study 102 was triggered.”
Sarepta stock resumed trading just before the close and has mostly recovered.
The news also came shortly after Sarepta announced plans to increase the study size from 24 patients to 40. It expects to complete enrollment and dosing before the end of the year with data announced by the end of 2020.
The company is also shifting the initiation of a confirmatory trial to the first half of 2020. Brian Abrahams, an analyst with RBC Capital Markets, in a note to investors, called this “a prudent strategy, given their competitive position.” Abrahams retained the “outperform” rating for Sarepta stock but dropped the price target from $222 to $218.
In its second-quarter report, Sarepta noted a quarterly loss of $3.74 per share compared to the Zacks Consensus Estimate of a loss of $1.08. Sarepta reported a net loss of $276.4 million for the quarter compared to a loss of $109.3 million in the same period in 2018. For the six-month period ending June 30, Sarepta reported a net loss of $353 million.
For the quarter, the company recorded net revenues of $94.7 million, up from $73.5 million in the second quarter of 2018. The big hit is research-and-development expenses, where the company reported $113.3 million for the second quarter.
“As we pass through mid-2019, we are very pleased to announce strong performance and solid execution against our goals,” stated Doug Ingram, Sarepta’s president and chief executive officer. “Exondys 51 (eteplirsen) continues to perform with second quarter sales of $94.7 million, 29% growth quarter over same quarter last year.”
Most of the news emphasized the company’s progress in R&D, with an interesting note that in addition to working on gene therapies for Rett Syndrome, cardiomyopathy, Emery-Dreifuss muscular dystrophy type 1, the company was moving outside of rare disease to work on multiple sclerosis.
