In a research report sent to investors today, Canaccord Genuity analyst Adam Walsh initiated coverage on shares of Sarepta Therapeutics (NASDAQ:SRPT) with a Hold rating and a $16 price target, which represents a potential upside of 7% from where the stock is currently trading.
Walsh wrote, “Sarepta’s lead drug candidate, eteplirsen, appears highly safe and effective for a subset of Duchenne muscular dystrophy (DMD) patients. However, strong efficacy results come from just a single, 12-patient study and long-term open label extension. Our key opinion leader (KOL) consultants suggest FDA may request that interim 6- month efficacy data (6MWT) from the ongoing 301 confirmatory trial be included in the NDA package, which could further delay the filing.
The analyst added, “We forecast a ~70% probability that competitive DMD drug drisapersen will receive FDA approval in 2H15. This outcome would decrease political pressure to approve eteplirsen near term. While we think eteplirsen will ultimately win FDA approval (est. 2017) and take majority DMD market share on superior safety, we remain cautious near term. Erratic FDA signals, lack of visibility on FDA position, and feedback from KOLs prompt our HOLD rating.”