A sudden change of heart at the FDA has sunk Sarepta Therapeutics' stock. Two weeks after saying the FDA would assess its gene therapy without an advisory committee meeting, Sarepta has revealed the agency will now convene experts to dig into the data on its Duchenne muscular dystrophy (DMD) submission.
At the end of last month, Sarepta told investors it had completed the midcycle review for the SRP-9001 submission, and, with no significant safety or clinical issues coming up, the FDA had decided to proceed without an advisory committee meeting. The decision triggered a jump in Sarepta’s share price and put it on course to potentially win approval by May 29 without facing the scrutiny of independent experts.
Late Thursday, Sarepta was forced to row back from its previous statement after learning that the FDA now plans to hold an advisory committee meeting. On a conference call with investors, Sarepta CEO Doug Ingram said no new information was provided, so the change doesn’t appear to be evidence driven.
Rather, Sarepta’s understanding is that the U-turn results from a reorganization at the FDA, the creation of the “super office” OTP—the Office of Therapeutic Products—and a desire to explore surrogate endpoints in accelerated approvals. The FDA created the super office last year, but Ingram sees the new structure as a driver of the change in thinking about the need for an advisory committee.
“As the 9001 application is one of the first gene therapy BLAs founded on a surrogate endpoint, CBER and OTP believe it appropriate to take expert advice in a public forum,” Ingram said. “It is our understanding that our safety is not identified as a significant issue—the primary topics of the advisory committee will be the design of the ‘9001 construct and the evidence supporting the conclusion that 9001 dystrophin is reasonably likely to predict clinical benefit.”
Ingram added that the main change between the mid- and late-cycle reviews were the “discussion of the surrogacy of 9001, and the discussion of the evidence to support the conclusion that 9001 is reasonably likely to predict clinical benefit.” No significant safety issues were identified at the late-cycle meeting.
Sarepta expects the FDA to set a date for the advisory committee meeting within the next week. While the biotech had recently been operating on the basis that no advisory committee was needed, it had previously assumed that the FDA would call a meeting and began planning to present the data on SRP-9001 back when it filed for accelerated approval in the fall.
The news triggered a 21% drop in Sarepta’s share price in after-hours trading, sinking the stock to $118 per share, even as Ingram sought to frame the change as a surprise rather than a setback. The CEO also made clear that he was blindsided by the news, telling investors the FDA previously said it “saw no circumstances” in which its original decision would change, and Sarepta checked again with the agency before going public with the fact that no advisory committee was planned.
Mizuho analysts said the "surprising turnaround" didn't change their view on the potential for accelerated approval of SRP-9001. "Given the later-than-expected AdCom notification, we believe investors may be concerned about potential approval delay but the FDA's public statement may provide investors reassurance of an on-time approval for SRP-9001 around the May 29 PDUFA date," the analysts added in a note Thursday evening.