(Reuters) -Sarepta Therapeutics’ shares plunged nearly 30% on Tuesday as the failure of two of its approved drugs in a key trial and weak forecast for its top selling gene therapy raised concerns about the strength of the company’s portfolio.
The trial setback compounds Sarepta’s woes as it is already facing scrutiny and restrictions related to its top-selling gene therapy, Elevidys, following deaths of two patients earlier this year.
Sarepta was testing its therapies, Amondys 45 and Vyondys 53, in a trial aimed at seeking confirmation of their effectiveness in treating Duchenne muscular dystrophy, a rare muscle wasting disorder that typically affects boys. Confirmatory trials are considered a key part of regulatory submissions for full approval of drugs.
The trial results will not affect the drugs’ availability in the market, Sarepta said, adding it plans to meet with the U.S. drug regulator to discuss converting the drugs’ current accelerated approvals into full approvals.
“Despite management’s confidence that Vyondys 53 and Amondys 45 will not lose marketing authorization as a result, we are more skeptical, and think the stock’s reaction suggests investors are also concerned about the future of these two products,” William Blair analyst Sami Corwin said in a note.
The company said the COVID-19 pandemic disrupted trial participation and data collection, potentially affecting the results.
“It is certainly believable that dose interruptions diluted the effect size, but the fact remains that the results from this post-hoc analysis are also not especially compelling,” said Bernstein analyst William Pickering.
Shares of the company, a specialist in DMD treatments, have fallen around 80% since the first Elevidys-related death was reported in March.
Sarepta said on Monday it expects Elevidys infusion volumes to be flat to slightly lower in the fourth quarter due to the disruptions this year. Elevidys generated $131.5 million in third-quarter sales, down from $281.9 million in the previous quarter.
(Reporting by Mariam Sunny and Joel Jose in Bengaluru; Editing by Saumyadeb Chakrabarty and Leroy Leo)
