Valeant Pharmaceuticals Intl Inc (NYSE:VRX) and Sarepta Therapeutics Inc (NASDAQ:SRPT) are two of this morning’s biggest gainers and losers. One top analyst continues to sound the alarm on Valeant after the company released a disappointing first quarter earnings report and slashed guidance, while another analyst remains cautious on Sarepta after the FDA asked for additional data on eteplirsen, or PROMOVI. Let’s take a closer look.

Valeant Pharmaceuticals Intl Inc

Valeant is down more than 17% in pre-market trading to $23.78 after the company released earnings this morning and slashed guidance. Irina Rivkind Koffler of Mizuho weighs in on the company, explaining how this disappointing report underlines her reservations about the company.

Valeant has been in the headlines as it faces a fraud allegation and an investigation into its pricing practices. Koffler has been critical of the company and bearish since March.

For the first quarter, the company posted a net loss of $373.7 million, or a loss of (1.08) per diluted share. This is a massive year-over-year loss as the company posted a net income of $97.7 million and $0.28 per diluted share in the first quarter of 2015. Looking forward, management expects total revenue between $9.9 billion and $10.1 billion for 2016, lower than the previous revenue estimate of about $11.1 billion. The company also lowered 2016 non-GAAP EPS estimate range from $6.60 to $7.00 down from the range of $8.50 to $9.50.

Koffler reminds investors not to be so fast in assuming that the stock is bottoming out because “business is expected to shrink even further as the company divests assets, manages through prior generic erosion guidance and additional pricing pressure, and begins to quantify the potential financial impact of its ongoing litigation.” The analyst warns that legal expenses will continue to climb and “settlement accruals could delay de-levering.”

Due to the mess that Valeant finds itself in, Koffler reiterates an Underperform rating on the company with an unchanged price target of $18, marking a 25% downside from current pre-market levels.

According to TipRanks, Koffler is a top ranked analyst with a 59% success rate recommending stocks and a 26.4% average one-year return. She is ranked in the top 1% of all analysts on Wall Street.Koffler stat

Sarepta Therapeutics Inc

Shares of Sarepta are soaring more than 30% in pre-market up to $20.99 after the FDA requested additional information on eteplirsen, or PROMOVI, the company’s experimental drug for Duchenne’s muscular dystrophy, or DMD. Ritu Baral of Cowen & Co. weighs in on the company following this news.

Baral notes that this news comes on the heels of a negative Advisory Committee meeting. Although the FDA does not have to follow the recommendation of the AdComm, it often does. The FDA requested the additional data to complete the New Drug Application review for PROMOVI, which the analyst estimates will take about 4 weeks to submit.

The analyst explains that this development does demonstrate a potential route forward for the drug, but also entails some clinical risk. She explains the route forward, commenting, “The FDA request for additional dystrophin data and not 6 Minute Walk Time data (6MWT) or any other functional endpoint data suggests the agency is likely open to an eteplirsen approval on Subpart H accelerated approval.” A mutation in the gene for dystrophin is the underlying cause for DMD, and the analyst believes this benchmark will be more favorable for the drug. However, the risk remains that PROMOVI data is based on a small number of just 13 patients.

Looking forward, Baral expects the company to “issue a press release upon data submission to FDA, whether the data are negative or positive given the materiality of the dataset.” From there, the FDA should make a final decision on the drug within several weeks.

Following this news, Baral remains on the sidelines of the company, reiterating a Market Perform rating without a price target.

According to TipRanks, 36% of analysts are bullish on Sarepta, 36% are bearish, and 28% are natural. The average 12-month price target is $21 marking a 30% potential upside from where shares last closed.