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Investing.com - Sarepta Therapeutics (NASDAQ:SRPT), currently valued at $1.83 billion, has agreed to add a black box warning for its Duchenne muscular dystrophy treatment Elevidys following a second patient death due to acute liver failure, according to Goldman Sachs. According to InvestingPro data, the company’s stock has fallen over 80% in the past year, reflecting ongoing challenges in its product portfolio.
The company plans to submit a proposed enhanced immunosuppressive regimen with sirolimus this week, including a six-month study in approximately 25 non-ambulatory patients to potentially resume commercial dosing for this patient group. This development comes as Sarepta reported preliminary second-quarter Elevidys sales of $282 million, representing a 25% quarter-over-quarter decline. InvestingPro analysis shows the company’s rapidly depleting cash position, with negative free cash flow of $695 million in the last twelve months.
Sarepta has also announced a significant restructuring, including a workforce reduction of approximately 36%, leadership changes, and prioritization of its ARWR-partnered siRNA programs. These measures are expected to generate $400 million in annual cost savings by 2026 and beyond.
Management has indicated that a revenue floor of $1.4 billion annually through 2027 (including $500 million from Elevidys) would support its revolving credit facility covenants and 2027 convertible debt obligations. Goldman Sachs currently forecasts Elevidys revenue of $725 million in 2026 and $900 million in 2027.
Goldman Sachs maintains a Neutral rating and $27.00 price target on Sarepta, citing ongoing risks including demand uncertainty amid caregiver hesitancy, potential impacts on ambulatory patients, regulatory alignment on the proposed non-ambulatory study, competition from other companies, and upcoming confirmatory exon-skipper data next year.
In other recent news, Sarepta Therapeutics reported preliminary second-quarter 2025 net product revenues of approximately $513 million, slightly exceeding the consensus estimate of $509 million. The company also disclosed Elevidys sales of about $282 million, marking a 25% decline from the previous quarter. Sarepta announced a strategic reorganization aimed at achieving around $400 million in cost savings through workforce reductions and pipeline prioritization. This restructuring includes a 36% workforce reduction, as noted by Needham, which maintained its Buy rating on the stock. In light of safety concerns, Sarepta updated the Elevidys label to include a black box warning following recent patient deaths.
Despite these challenges, Leerink Partners reiterated its Outperform rating, emphasizing Sarepta’s potential for generating discounted cash flows. However, H.C. Wainwright maintained a Sell rating and a $10.00 price target, citing concerns over declining Elevidys revenues and questioning future revenue projections. William Blair reiterated its Market Perform rating, expressing concerns about the safety profile of Sarepta’s gene therapies following a patient death. Cantor Fitzgerald maintained a Neutral rating, highlighting deep concerns about Elevidys’s safety and projecting rocky sales ahead.
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