By Bhanvi Satija
(Reuters) -The U.S. Food and Drug Administration is planning to request Sarepta Therapeutics to voluntarily stop all shipments of its gene therapy, Elevidys, a source familiar with the matter told Reuters on Friday.
Sarepta’s stock tumbled over 40% to $12.81, its lowest level in more than nine years, after being briefly halted.
A company spokesperson said the drugmaker has yet to receive a formal request.
The agency’s scrutiny of Sarepta has sharpened since the deaths of two teenage boys earlier this year who had received Elevidys, a gene therapy approved in the United States to treat a muscle-wasting condition called Duchenne muscular dystrophy.
Earlier on Friday, Sarepta disclosed the death of a third patient – a 51-year-old man with limb-girdle muscular dystrophy who had received its experimental gene therapy SRP-9004.
Like the two teenagers, he died from acute liver failure and was non-ambulatory, meaning unable to walk independently. In June, Sarepta stopped shipments of the therapy to such patients.
Wall Street analysts have said the third death could amplify patient hesitancy to use Elevidys, given both the therapies use the same delivery vehicle known as adeno-associated virus vector.
The company is in the process of changing its label for Elevidys, and the FDA will see the change through, the source told Reuters on Friday.
Earlier in the day, FDA Commissioner Marty Makary told Bloomberg News in an interview that he was “taking a hard look” at whether a gene therapy from Sarepta should remain on the market.
MANAGEMENT CREDIBILITY
On an investor call on Friday, Sarepta faced pointed questions from analysts over why it had not disclosed the recent patient death earlier in the week.
CEO Doug Ingram said the matter was “neither material, nor central” to Wednesday’s update that had focused on the company’s restructuring.
“This event occurred in a trial that was otherwise completed with all dosing,” said Ingram, adding that the decision to not proceed with the study was made independently of the patient’s death.
The company also said liver issues were not a new safety signal in the study, which is part of its now-halted limb-girdle muscular dystrophy (LGMD) gene therapy programs.
On Wednesday, Sarepta had announced 500 layoffs as well as cuts to its LGMD programs, citing financial reasons. It had not mentioned the patient death then, despite analyst inquiries about safety.
Sarepta reiterated the financial basis of its decision on Friday’s investor call, but some analysts, including those at BMO Capital Markets, warned it could damage management credibility.
At least two analysts asked whether other deaths had occurred in Sarepta’s gene therapy programs. The company said it was not aware of any beyond the three that were disclosed.
“We are, historically, a very transparent organization. If there was a change in the risk profile of Elevidys, we would first and foremost, share with physicians and patients, and then, of course, we would share it with investors,” Ingram said.
(Reporting by Bhanvi Satija in Bengaluru; Additional reporting by Christy Santhosh; Writing by Mrinalika Roy; Editing by Devika Syamnath)
