Sarepta Therapeutics’ report of a second fatality this 12 months in a affected person dosed with its Duchenne muscular dystrophy gene remedy raised the prospect it may need to tug the product from the market. The corporate is avoiding that worst-case situation with a stricter security warning on the label of the remedy, Elevidys. However Sarepta can also be slashing its workforce and its pipeline, strikes executives mentioned are wanted to maintain the agency financially viable.
The company restructuring will lower 36% of the workforce, representing about 500 workers, Sarepta introduced after Wednesday’s market shut. The corporate initiatives the layoffs and pipeline reprioritization will save about $400 million yearly.
The 2 Duchenne sufferers who died, the primary in March and the second in June, each developed acute liver failure. These sufferers had been youngsters who had been non-ambulatory, which issues as a result of sufferers who’re older and heavier require the next dose of Elevidys. Sarepta mentioned the FDA requested that the product’s label be up to date with a black field warning calling out the chance of liver damage and liver failure. This warning is according to different gene therapies delivered by adeno-associated viruses, and Sarepta agreed to the replace. The corporate added that this modification seems to resolve any points for the a part of the label referencing ambulatory sufferers.
In response to the fatalities, Sarepta voluntarily stopped shipments of Elevidys for non-ambulatory sufferers. The corporate additionally convened a committee of Duchenne and liver specialists for recommendation. This committee really helpful that Sarepta examine the addition of the immunosuppressant sirolimus to the gene remedy’s normal immunosuppression routine. The committee’s findings shall be submitted to the FDA as a part of a proposal to check this revised immunosuppression routine in a brand new cohort added to an ongoing scientific trial. This six-month examine will enroll as much as 25 non-ambulatory sufferers. Sarepta mentioned outcomes may re-establish dosing in non-ambulatory Duchenne sufferers.
Within the two years since Elevidys entered the market as the primary gene remedy for Duchenne, the product has quick grow to be Sarepta’s high vendor and pushed the agency into profitability. Even with the one-time remedy accessible now solely to ambulatory Duchenne sufferers, the corporate initiatives it can nonetheless be a powerful vendor with a minimal of $500 million in annual income on this narrower affected person group by 2027. However Elevidys nonetheless faces industrial headwinds. In a Wednesday night convention name, Sarepta executives acknowledged decrease curiosity within the gene remedy evidenced by some affected person cancelations following the fatality reviews.
Sarepta additionally markets three antisense oligonucleotide medicine for Duchenne, merchandise which are dosed chronically. The corporate initiatives about $900 million in mixed annual gross sales for these merchandise.
Sarepta’s gene remedy analysis yielded three different clinical-stage gene therapies, all for limb-girdle muscular dystrophies. These packages shall be paused, aside from essentially the most superior one, SRP-9003, a possible gene remedy for limb girdle muscular dystrophy kind 2E. Sarepta plans to submit an FDA biologics license software for this remedy within the second half of this 12 months, based on an investor presentation.
Sarepta mentioned it can search strategic alternate options for the paused packages, together with potential partnerships with different corporations. The agency’s remaining R&D sources will concentrate on small interfering RNA (siRNA), a kind of genetic medication that works by pulling down overexpression of a disease-driving protein. Sarepta has clinical-stage siRNA packages for facioscapulohumeral dystrophy kind 1, myotonic dystrophy kind 1, spinocerebellar ataxia kind 2, and idiopathic pulmonary fibrosis in addition to a preclinical Huntington’s illness remedy. These packages got here from Arrowhead Prescribed drugs beneath a license and collaboration settlement introduced final fall. Sarepta dedicated $825 million up entrance, comprised of money and an fairness funding in Arrowhead.
Past the packages taken over by Sarepta, the deal additionally permits the corporate to pick out as much as six new targets for Arrowhead to analysis with its RNA interference expertise platform. Sarepta mentioned it can proceed to work completely with Arrowhead to develop therapies for skeletal muscle illnesses.
In a observe despatched to buyers, Leerink Companions analyst Joseph Schwartz mentioned the FDA request for a black field warning for Elevidys suggests the company received’t take away the product from the market. He added that the extra warning and the examine of a modified immunosuppression routine are prudent, and Sarepta’s inventory value ought to get some reduction now that the prospect of product elimination has been prevented.
“Extra work must be achieved to get again investor enthusiasm, however that is definitely a step in the fitting course,” Schwartz mentioned.
Sarepta mentioned it can report a one-time cost between $32 million and $37 million associated to termination advantages. With the restructuring, the corporate expects it can keep entry to its $600 million revolving credit score facility and generate enough money movement to handle its monetary obligations, together with reimbursement of a 2027 convertible observe.
Picture by Sarepta Therapeutics
