Sarepta Stock More Than Doubles This Year So Far: Here's Why
Zacks Investment Research | Nov 22, 2018 09:03PM ET
Shares of Sarepta Therapeutics, Inc. (NASDAQ:SRPT) have displayed a solid uptrend so far this year. The biotech company’s stock has surged 110.3% against the 20.3% decline of the industry in this period.
The company has only one marketed product in its portfolio, Exondys 51, which received accelerated approval in September 2016. The drug is approved for treating patients with Duchenne muscular dystrophy (“DMD”), a rare genetic disorder affecting children who have confirmed mutation of the DMD gene susceptible to exon 51 skipping. The company is also developing other pipeline candidates including gene therapies for treating DMD.
The company has progressed well with the commercialization of Exondys 51, development of its lead pipeline candidate and collaboration for gene therapies in 2018 so far.
Exondys 51’s Impressive Performance
The drug generated sales of $216.6 million in the first nine months of 2018, a significant increase of 122.6% year over year on the back of strong demand trends. The drugs has also grown sequentially so far in 2018. Sales of the drug in 2017 were $154.6 million. Based on sales trends witnessed so far in 2018, Sarepta expects Exondys 51 sales to be almost $300 million for the year.
The launch of a Managed Access Program in Europe and North America last year is also favorably impacting sales as the drug is now available to a larger patient population. The company remains on track with its phase III PROMOVI study evaluating Exondys 51. Data is expected in 2019 and will form the basis for continued approval of the drug.
Moreover, settlement of a global patent litigation related to exon skipping technology used in DMD therapies with BioMarin Pharmaceutical Inc. (NASDAQ:BMRN) in mid-2017 removed a major overhang for Sarepta. Per the settlement terms, BioMarin has granted Sarepta global exclusive rights to its DMD patent estate for Exondys 51 and all future exon-skipping products.
Exon-Skipping Pipeline Progress
Sarepta is focused on building its DMD pipeline beyond Exondys 51 by developing other exon-skipping treatments. In fact, the company has about eight exon-skipping candidates in its pipeline, including golodirsen and casimersen, which are expected to treat 75-80% of the DMD population.
Sarepta’s lead candidate, golodirsen, showed better improvement in patients in a mid-stage clinical study compared to results achieved by Exondys 51. The candidate has demonstrated 100% response rate with 10.7 times increase in mean dystrophin protein production from baseline, whereas Exondys 51 had achieved nearly three times, in DMD patients. A phase III study is currently enrolling patients.
Sarepta remains on track to submit a new drug application for this DMD candidate by the end of this year. The company is developing casimersen in a phase II study.
Gene Therapies
Sarepta is also developing gene therapies for treating DMD and other nervous disorders. The gene therapies have shown promising results so far in treating DMD patients by restoring dystrophin production in muscles throughout the body by delivering microdystrophin via adeno-associated virus. Sarepta is evaluating it most advanced gene therapy, AAVrh74.MHCK7.micro-Dystrophin, in a phase I/II study in DMD patients.
Sarepta is collaborating with other companies and academic institutions to boost its pipeline or manufacturing capacity for gene therapy. The company’s gene therapy portfolio currently has 14 programs in several early stages of development.
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