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Investing.com - William Blair reiterated its Market Perform rating on Sarepta Therapeutics (NASDAQ:SRPT) following recent FDA announcements that could impact the company’s gene therapy treatments. The stock, currently trading at $14.08, has seen significant pressure, falling nearly 90% over the past year according to InvestingPro data.
The FDA’s announcement represents a significant setback for Sarepta, potentially reducing patient interest in its Duchenne muscular dystrophy treatment Elevidys and suggesting a deteriorating relationship between the company and regulators.
While the threat of Elevidys being removed from the market could raise concerns about Sarepta’s long-term debt obligations, William Blair analysts believe the treatment will remain available to patients.
The firm notes that clinical holds on Sarepta’s programs will likely have minimal material impact on the company, though they will delay the Biologics License Application (BLA) submission for SRP-9003, its limb-girdle muscular dystrophy treatment.
William Blair has updated its financial model to reflect delayed SRP-9003 submission and lower commercial adoption of Elevidys, now projecting a full-year 2025 net loss of $233 million, or $2.37 per share.
In other recent news, Sarepta Therapeutics has faced several significant developments. Mizuho (NYSE:MFG) has downgraded the company’s stock from Outperform to Neutral, reducing its price target to $14.00 due to safety concerns with Sarepta’s gene therapy platform. This follows reports of a third fatal case of acute liver failure in patients treated with the AAVrh74 platform vector, prompting the FDA to request a voluntary halt of Elevidys shipments. Similarly, Leerink Partners downgraded Sarepta from Outperform to Market Perform, citing management credibility issues and the potential for Elevidys to be removed from the market entirely. Deutsche Bank (ETR:DBKGn) also downgraded Sarepta to Sell, lowering its price target to $9.00, and expressed concerns over the company’s transparency and the impact on patient demand. Baird followed suit, downgrading Sarepta to Neutral with a price target of $15.00, highlighting existential uncertainty and safety concerns surrounding Elevidys. Additionally, a BMO Capital survey revealed investor apprehension about Sarepta’s financial stability and management credibility, with many expressing doubts about future prospects. These recent developments have collectively raised questions about the company’s ability to navigate ongoing challenges.
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