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Investing.com - TD Cowen has reiterated its Hold rating and $28.00 price target on Sarepta Therapeutics (NASDAQ:SRPT) following concerns about the company’s disclosure practices regarding a patient death. The stock, currently trading at $14.08, has fallen over 90% in the past year, with InvestingPro data showing the company’s current market capitalization at $1.38 billion.
The firm cited a recent incident where unsubstantiated media reports revealed that a 51-year-old patient in the Phase 1/2 trial of Sarepta’s gene therapy SRP-9004 for limb-girdle muscular dystrophy (LGMD) Type 2D died 11 weeks post-treatment from acute liver failure. This news emerged at the start of the International LGMD Conference in Orlando. According to InvestingPro analysis, the company is currently burning through cash rapidly, with negative free cash flow of $695 million in the last twelve months.
The FDA has placed a hold on all Sarepta LGMD studies following the incident. According to TD Cowen, Sarepta disclosed the event to the FDA and LGMD/DMD patient groups under confidentiality but did not make it public, arguing it was not material despite similarities to Elevidys safety events.
TD Cowen noted that investor credibility was particularly damaged by Sarepta’s lack of disclosure when responding to a specific analyst question about LGMD risk/benefit during a July 16 public call. The firm pointed out that patterns of non-disclosure have undermined Sarepta’s credibility with DMD patient groups.
The research firm believes that patient group support for Sarepta has "greatly eroded since winter," with frustration growing over the company’s lack of transparency regarding the overall safety of Elevidys, including cases of sudden cardiac death post-treatment and rates of severe liver events.
In other recent news, Sarepta Therapeutics is navigating significant regulatory and financial challenges. The company is under scrutiny from the FDA following reports of patient deaths linked to its gene therapy, Elevidys. H.C. Wainwright has reiterated a Sell rating and slashed its price target to $0, citing Sarepta’s refusal to halt Elevidys shipments despite the FDA’s request. BofA Securities has maintained a Neutral rating with a $20 price target, noting that the therapy will continue to be available for ambulatory patients, albeit with a limited uptake. Wells Fargo (NYSE:WFC) also maintained its Overweight rating and $65 price target, predicting resilience for Elevidys in ambulatory indications. JPMorgan lowered its price target to $20 from $28 but kept an Overweight rating, acknowledging potential upside if Elevidys remains available. Meanwhile, William Blair reiterated a Market Perform rating, adjusting its financial model to account for delayed submissions and lower commercial adoption. Sarepta faces financial pressure with $1.1 billion in convertible debt against $850 million in cash, and the absence of an immediate revenue replacement for Elevidys adds to the company’s challenges.
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