Sarepta: FDA’s Preliminary Guidance On DMD – Another Sign of Regulatory Flexibility, Says Roth Capital


In a research note published today, Roth Capital analyst Debjit Chattopadhyay reiterated a Buy rating on Sarepta Therapeutics (NASDAQ:SRPT) with a $34 price target. 

The analyst noted, “The FDA’s preliminary draft guidance acknowledges the need for flexibility in evaluating disease modifying therapies for the treatment of DMD. Importantly, it highlights the willingness of patients and families to undertake greater risk in exchange of disease stabilization. The focus on disease biomarkers, could pave the way for the wider acceptance of Dystrophin, and may allow for accelerated approval. Other beneficiaries include PTC Therapeutics (NASDAQ:PTCT), and Prosensa (NASDAQ:RNA).

The analyst continued, “The agency has been hesitant to expose young subjects to unnecessary risks of relatively untested pharmacological agents. However, in case of DMD the risk of doing nothing potentially exceeds the risk of a limited and conditional approval, in our opinion. The guidance highlights the fact that DMD is a debilitating disease with a very narrow window of opportunity for a therapeutic intervention to preserve QOL. We continue to believe that patients need to be treated as early as possible, since therapies aimed restoring functional Dystrophin, to be truly effective, need preexisting myofibers. Based on eteplirsen’s pharmacology, chemistry, and robust safety profile we believe Sarepta is uniquely positioned with a appropriately balanced reward/risk profile. Even if current generation of therapies is found to be equivalent to corticosteroids, we believe that it would represent an incremental progress as patients won’t be burdened with the side effect profile of corticosteroids.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Debjit Chattopadhyay has a total average return of 2.2% and a 36.4% success rate. Chattopadhyay has a -10.7% average return when recommending SRPT, and is ranked #1817 out of 3270 analysts.

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