Sarepta Therapeutics, Inc. 's SRPT shares touched a 52-week low of $10.60 on Feb 8 with the company announcing disappointing news that the FDA has extended the review period of its new drug application (NDA) for eteplirsen by three months.
The regulatory body will now announce its decision by May 26, 2016, instead of the previous date of Feb 26, 2016. The company's shares plunged 12.1% on the news.
Sarepta is looking to get eteplirsen approved for the treatment of patients suffering from Duchenne muscular dystrophy (DMD) amenable to exon 51 skipping.
What Led to the Delay?
The FDA informed the company that the submission (Jan 8, 2016) of four-year clinical effectiveness data, which included an additional six-minute walk test and loss of ambulation data compared to a historical control, has been designated as a major amendment to the NDA. The FDA stated that it will require additional time to complete its review of the submission.
We remind investors that last month the regulatory agency had raised concerns about the candidate's efficacy in the briefing documents that were released ahead of the Peripheral and Central Nervous System Drugs Advisory Committee meeting (Read more: Sarepta Tanks, Eteplirsen Briefing Document Raises Concerns ).
The FDA panel was supposed to review the NDA for eteplirsen on Jan 22, 2016. However, the meeting was postponed due to inclement weather. The rescheduled date of the meeting is yet to be set.
Considering that Sarepta has no approved product in its portfolio at the moment with eteplirsen being the company's lead pipeline candidate, the latest development comes as a major blow for the company. The delay in eteplirsen's approval is weighing on the company's prospects.
Another company, BioMarin Pharmaceutical Inc. BMRN , seeking FDA approval for its experimental DMD treatment, Kyndrisa, received a complete response letter from the agency last month.
We expect investor focus to remain on the advisory panel meeting and approval status of eteplirsen.
Sarepta is a Zacks Rank #4 (Sell) stock. A couple of better-ranked stocks in the health care sector are Anika Therapeutics Inc. ANIK and Baxalta Incorporated BXLT , each carrying a Zacks Rank #1 (Strong Buy).