Sarepta Back Hands FDA’s Request to Halt Elevidy Treatment After Three Deaths (Investors Screwed?)

“Greed is good…” - Sarepta’s board, probably… 

If you haven’t heard the news, Sarepta Therapeutics just threw the patient-first playbook out of the window and has flat-out refused the FDA’s request to halt shipments of its flagship gene therapy Elevidys… even after three deaths linked to the treatment platform. 

(Source: Giphy) 

For starters, two teenage boys with Duchenne muscular dystrophy, both wheelchair-bound, died from acute liver failure after receiving Elevidys. A third death, a 51-year-old man in a Sarepta trial for a different gene therapy (SRP-9004) that uses the same viral delivery system, occurred just weeks earlier. And yet, Sarepta's response to the FDA? Thanks, but no thanks. The company claims there are “no new or changed safety signals” for the ambulatory patients still receiving Elevidys… who, not coincidentally, make up 85% of the treatment population and more than half the company’s revenue. Translation: Investors can do the math. 

(Source: Zerohedge) 

With that said, the FDA’s original 2023 Elevidys approval came under its accelerated program… a regulatory fast-pass built for desperate diseases like Duchenne, but with looser safety guardrails and a mile-wide asterisk around long-term efficacy. However, that bet is now aging like milk. Initial evidence never showed Elevidys improved motor functions in a statistically meaningful way. What it did show was an uptick in a dystrophin protein surrogate… like judging a car’s performance by the quality of the paint. But the FDA, led at the time by Peter Marks, overruled internal skeptics. The result: three deaths, a corporate cover-your-ass assets spree, and a credibility crisis for the entire accelerated approval mechanism. 

(Source: Wall Street Journal) 

Vinay Prasad, the agency’s new gene therapy chief and professional wet blanket, isn’t thrilled. Before joining the FDA, he famously quipped you could “replace Peter Marks with a bobblehead doll that just stamps approval.” This latest clusterf**k may be the first time he gets to play clean-up crew. Which means, if the science wasn’t murky enough, Sarepta’s investor relations strategy feels ripped from the Theranos playbook. For example, the third death was not disclosed during the company’s recent restructuring call, all while executive raises were filed Monday… right before the stock cratered. 

(Source: Giphy) 

Additionally, mass layoffs of 500 employee cuts were announced Thursday, immediately before the fatality went public Friday. Oh, and the boxed warning on Elvidy’s? It was quietly added on Wednesday. And then… shares collapsed 36% on Friday and are now hovering somewhere between “oversold” and “radioactive.” Analysts are split: some believe the FDA will yank Elevidys entirely, while others think the agency will let it limp forward with boxed warnings, tighter indications, and enough legal disclaimers to wallpaper a courtroom. The biggest risk though is the entire AAV platform. That same delivery tech underpins most of Sarepta’s gene therapy pipeline. Meaning, If Elevidys get’s body bagged, Sarepta’s future gets priced like a science experiment with no safety net.

Of course, Sarepta is betting that Elevidys remains too important to pull entirely. Parents of Duchenne patients have historically lobbied hard for faster access to therapies, and Sarepta is leaning on that momentum. But sentiment can flip fast when hope is replaced by loss… because, duhh. For investors though, this is a ticking time bomb where you should expect more chaos, that is: FDA scrutiny, analyst downgrades, and a painful period of volatility that rips faces off. 

(Source: Giphy) 

In the end, the days of biotech fast passes without receipts may be numbered. And Sarepta just became the full-send catalyst for it. Obviously, things can change and only time will tell what comes of it. But for now, keep your head on the swivel and place your bets accordingly. Until next time, friends… 

At the time of publishing, Stocks.News holds positions in companies mentioned in the article.