Sarepta Therapeutics receives expanded approval for Elevidys

Sarepta Therapeutics Inc (NASDAQ: SRPT) rallied a whopping 40% in extended hours today following a key announcement from the U.S. Food and Drug Administration regarding Elevidys.

Elevidys is the company’s treatment for Duchenne muscular dystrophy. 

Why is it significant for Sarepta Therapeutics stock?

The FDA granted accelerated approval for a label expansion of “delandistrogene moxeparvovec” to include non-ambulatory patients on Thursday. 

The decision is significant for individuals with DMD who have lost the ability to walk. Jerry Mendell – the co-inventor of Elevidys said in a press release today:

The expanded indication means clinicians now have a treatment option for the great majority of boys and young men living with Duchenne.

Sarepta Therapeutics stock is now up a whopping 80% versus the start of 2024. 

Trading in Sarepta shares was temporarily halted

On Thursday, the U.S. regulator announced traditional approval for the treatment in ambulatory patients as well. According to Doug Ingram – the chief executive of Sarepta Therapeutics:

Today also stands as a watershed occasion for the promise of gene therapy and a win for science.

Both approvals apply to patients aged four years and older. The expanded approval is expected to materially impact the lives of individuals living with DMD, a rare genetic disorder that primarily affects boys, with an incidence rate of about one in every 3,300. 

Trading in Sarepta shares was temporarily halted around 4:54 PM ET in anticipation of this news. Investors then cheered the news and pushed the stock up as trading resumed at 5:35 PM. SRPT recently joined the S&P MidCap 400.

Is there upside left in Sarepta stock?

Sarepta Therapeutics has already commenced a phase 3 post-marketing trial or the ENVISION study in non-ambulatory and older ambulatory patients of Duchenne to satisfy a condition for accelerated approval. 

Note that Roche – a Swiss pharmaceutical giant is responsible for regulatory approvals as well as marketing of Elevidys outside of the United States. Jerry Mendall also said today:

This expansion speaks to the success of the science, the evidence and the improvements in the trajectory of the disease we have seen to date across studies.

Last month, SRPT reported its financial results for the first quarter that topped Street estimates. The drug developer earned 73 cents a share on $413.46 million in revenue versus 11 cents of per-share loss and $253.5 million in revenue in the same quarter of 2023. 

Earlier in June, analysts at BMO Capital reiterated their “outperform” rating on Sarepta Therapeutics stock that has already touched their $170 price target announced at the time. 

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