Sarepta surges as investors cheer expanded use of gene therapy (updated)
21/06/2024 14:56
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By Mariam Sunny and Bhanvi Satija
June 21 (Reuters) - Sarepta Therapeutics SRPT.O shares
surged about 33% to a more than three-year high in early trading
on Friday as an expanded use approval cemented its dominant
position in the gene therapy market for Duchenne muscular
dystrophy (DMD).
At current levels, nearly $4 billion was set to be added to
the company's market value.
On Thursday, the U.S. FDA granted traditional approval for
the therapy, Elevidys, in patients four years and above who can
walk, as well as an accelerated approval for those who cannot.
"Many patients below age 4 are not yet diagnosed but will
age into the label, opening the DMD market to all current and
future patients who will be eligible for treatment," said
William Blair analyst Tim Lugo.
Given the high demand and acceptable safety, analysts
flagged manufacturing concerns and insurance coverage for newly
added patients as limiting factors.
"We do not anticipate any near-term supply constraints,"
Sarepta CEO Doug Ingram said on a call with investors, adding
the company does not intend to modify the price.
Elevidys is among the most expensive treatments in the world
with a list price of $3.2 million.
Sales of the therapy came in at $200.4 million in 2023 and
are expected to rise to $1.07 billion this year, as per LSEG
data.
DMD is an inherited progressive muscle-wasting disorder that
affects an estimated one-in-3,500 male births worldwide,
according to the U.S.-based National Organization for Rare
Disorders.
Elevidys' could now be given to about 13,000 patients, or
nearly 90% of U.S. patients, said BMO Capital analyst Kostas
Biliouris.
The decision also follows concerns around an "uphill battle"
to secure traditional approval after the therapy failed to meet
the main goal in a key confirmatory late-stage trial.
A top official of the agency, Peter Marks, pushed for the
"no strings attached" label for Elevidys overruling
recommendations, RBC markets analyst Luca Issi said. FDA staff
had recommended declining the expansion, citing a lack of
benefit to certain patients, documents show.
The global treatment market for DMD - including gene
therapies and other drugs - is expected to grow to $11.47
billion by 2034, according to ResearchandMarkets.com.
Biliouris expects Elevidys to be the "dominant" DMD gene
therapy with no near-term competition until later than 2027.
RegenxBio RGNX.O is testing a rival gene therapy in early-
to mid-stage, while Pfizer's PFE.N treatment recently failed
in a late-stage study.
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(Reporting by Mariam Sunny and Bhanvi Satija in Bengaluru;
Editing by Sriraj Kalluvila)
((Mariam.ESunny@thomsonreuters.com;))