UPDATED: Sarepta plunges as CEO moves goal line on Duchenne MD drug downfield

Sarepta CEO Chris Garabedian

It turns out Sarepta ($SRPT) isn't as close to filing a new drug application for its closely watched Duchenne muscular dystrophy drug eteplirsen as it once believed. Following a meeting with regulators in September, the biotech spelled out a new set of data that the FDA is looking for in the application, saying it will have to delay filing--another dramatic turning point for the company this year, which saw its shares plunge more than 35% on the news this morning.

Sarepta shares have been on a roller coaster ride over the past two years as the company was forced repeatedly to move the goal lines on a prospective approval for the drug, which so far has registered promising data from a tiny study involving only a dozen boys. The biotech today spelled out regulators' demands for imaging and long-term results as well as more safety data, all of which will stall the company until at least mid-2015--or longer.

Sarepta had noted earlier that it was on track to complete its NDA by the end of this year, with CEO Chris Garabedian insisting that regulators had clearly indicated that they were wide open to an early approval well ahead of Phase III study results. That announcement had followed setbacks at the agency which in turn had triggered an outcry from patient groups determined to obtain this drug for the children afflicted with this lethal disease. A board room fight this past summer over the CEO's personal role in negotiating with the FDA only sharpened the drama--though Garabedian came out on top in that dispute.

Today, Garabedian's position is weaker than ever, with the company's credibility on the line.

Leerink's Joseph Schwartz quickly noted this morning that these new hurdles increase the odds against Sarepta's quest for an early approval and push Prosensa's ($RNA) rival bid for a quick OK of its DMD drug to the forefront. "We are lowering our Price Target to $14 (from $24 previously) to reflect both a delay and increased eteplirsen regulatory risk," wrote Schwartz. Prosensa's shares surged 4% this morning.

In its release this morning Sarepta said that its NDA will now require "independent assessment of dystrophin images and the 168-week clinical data from study 202. Additionally, the guidance requests more specific data including a minimum duration of safety in new patients exposed to eteplirsen, patient-level natural history data to be obtained by Sarepta from independent academic institutions, and MRI data from a recent study conducted by an independent academic group. The FDA indicated that further discussion with Sarepta "will be necessary to determine what would constitute a complete NDA." Based on these requests, Sarepta plans to submit an NDA by mid-year 2015, pending any additional requests from further discussions with the FDA."

"We are committed to satisfying the FDA's updated requests for these specific data to be included as part of an NDA submission and will continue to work with the Agency toward the goal of a complete and acceptable NDA filing," said Chris Garabedian, president and chief executive officer of Sarepta Therapeutics. "We believe all of the data requests and additional FDA discussions that have currently been outlined can be completed in time for an NDA submission by mid-year 2015. Obtaining an FDA approval of eteplirsen for the DMD patients who may benefit from the drug continues to be our highest priority."

- here's the release

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