Sarepta falls after gene therapy maker pauses Elevidys shipments in US
The U.S. Food and Drug Administration on Friday asked Sarepta to voluntarily halt shipments of the gene therapy, but the company refused to do so and said it would continue making the treatment available to ambulatory patients.
But Sarepta has now voluntarily and temporarily paused all shipments of the therapy, effective end of Tuesday. The company said the decision would allow it to respond to requests from the FDA and maintain a positive relationship with the agency.
"Though Sarepta claims its pause in shipments was voluntary, we think the company moved preemptively — bracing for an inevitable FDA mandate to pull the drug," said H.C. Wainwright analyst Mitchell Kapoor.
Shares of Sarepta fell 6.9% to $12.40 in early trading on Tuesday.
"Sarepta's decision to comply was a capitulation after recognizing that the fight with the FDA was not winnable and that the agency would have strong-armed Sarepta into removing Elevidys with a formal demand," Kapoor added.
Investor concerns regarding the use of the company's treatments have been heightened after the company on Friday disclosed that another patient who had received its experimental gene therapy died from acute liver failure, marking the third death this year.
The company's shares have plummeted 89% so far this year.
On Monday, Children's Hospital Los Angeles said it had paused usage of Elevidys in all patients with muscular dystrophy.
The FDA's initial request had likely heightened the pressure on physicians to pause treatments, which could also have been a driving factor in Sarepta's decision, William Blair analyst Sami Corwin said.
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