FDA Database Reports Two Elevidys Patient Deaths Unconnected to Therapeutic Use, Confirms Sarepta

In the world of biotechnology, there has been a flurry of news this week, with Sarepta Therapeutics (NASDAQ: SRPT) taking centre stage. The company, known for its marketed gene therapy Elevidys® (delandistrogene moxeparvovec-rokl) for Duchenne muscular dystrophy (DMD), announced that the deaths of two patients taking the treatment were unrelated to its use.

Two patients, a 25-year-old who died of a pneumothorax about three months following Elevidys treatment, and a 19-year-old with a low ejection fraction who had experienced a viral infection, were reported on the FDA Adverse Event Reporting System (FAERS) database. Neither death was attributed to acute liver failure, the cause cited for two deaths tied to Elevidys that became public earlier this year.

Despite these reports, Sarepta's stock finished the week with a roughly 15% gain, largely due to stronger-than-expected second-quarter results. The company beat analyst expectations by finishing the quarter with $611.091 million in combined total product, collaboration, contract manufacturing, and royalty revenue. Elevidys accounted for more than half (55%) of Sarepta's total Q2 product revenue.

However, analysts remain cautious about the third quarter's sales outlook for Elevidys. Andrew Tsai, equity research analyst at Jefferies, projects a 50% sales decline in the third quarter, with estimates ranging from $121 million to $130 million. Joseph P. Schwartz, senior managing director, rare diseases, and a senior research analyst with Leerink Partners, shared similar sentiments, predicting a sales decline during Q3.

Sarepta resumed shipping Elevidys to ambulant patients late last month, but has paused shipping to non-ambulant patients. This pause and resumption of shipments could lead to "lumpiness" in Elevidys revenue in the third quarter, according to Sami Corwin, PhD, a biotechnology-focused healthcare analyst with William Blair.

Meanwhile, other biotech companies have been making headlines. Avidity Biosciences (NASDAQ: RNA) shares jumped 26% after reports of potential acquisition interest from Novartis (SIX Swiss: NOVN). Myriad Genetics (NASDAQ: MYGN) shares soared 46.5% due to exceeding analyst expectations, raising full-year revenue guidance, and closing on a $200 million credit facility.

However, not all news was positive. Eli Lilly (NYSE: LLY) shares skidded 16% over two days due to disappointing results from the Phase III ATTAIN-1 trial assessing orforglipron. Sana Biotechnology (NASDAQ: SANA) shares nosedived 30% after pricing an underwritten public offering at $3.35 per share, 21% below its previous closing price.

In the midst of these developments, Sarepta's stock price received a boost from analysts. Wells Fargo (Yanan Zhu, PhD) raised its 12-month price target projection on Sarepta's stock from $48 to $50. Goldman Sachs (Salveen Richter) also increased its 12-month price target projection on Sarepta's stock from $10 to $19.

The search results do not specify which company has licensed the gene therapy Elevidys® outside the United States. The recent events surrounding Elevidys may lead to significant hesitancy, according to Schwartz, who believes there could be hesitancy following recent events related to Elevidys. Despite this, Sarepta remains a significant player in the DMD treatment market, and its future developments will continue to be closely watched.