Sarepta to cut 36% of workforce amid strategic restructuring

CAMBRIDGE, Mass. - Sarepta Therapeutics, Inc. (NASDAQ:SRPT), whose stock has declined nearly 88% over the past year and is currently trading near its 52-week low of $16.88, announced Wednesday a strategic restructuring plan that includes a 36% workforce reduction affecting approximately 500 employees, as the company refocuses its pipeline on high-impact programs.

The biotechnology company expects the restructuring to deliver about $400 million in annual cost savings, with approximately $120 million coming from workforce reductions and $300 million from pipeline reprioritization. The plan aims to position Sarepta to meet its 2027 financial obligations and support long-term financial viability. According to InvestingPro data, the company has been rapidly burning through cash, with negative free cash flow of $695 million in the last twelve months. Despite challenges, InvestingPro analysis suggests the stock is currently undervalued.

Sarepta reported preliminary second quarter 2025 total net product revenue of $513 million, with $282 million from its gene therapy ELEVIDYS and $231 million from RNA-based treatments. The company held approximately $850 million in cash and investments as of June 30. While revenue growth remains strong at 59% year-over-year, InvestingPro analysts have revised earnings estimates downward for the upcoming period. For deeper insights into Sarepta’s financial health and future prospects, investors can access the comprehensive Pro Research Report available on InvestingPro.

The U.S. Food and Drug Administration has requested a black box warning for ELEVIDYS related to acute liver injury and acute liver failure, which Sarepta has agreed to implement. The company temporarily paused shipments of ELEVIDYS for non-ambulant patients while developing enhanced safety protocols, which it plans to submit to regulators imminently.

"Faced with environmental changes, we have decided to act decisively, implementing a focused strategy to ensure Sarepta remains a vibrant, financially enduring, patient-centric organization," said Doug Ingram, chief executive officer of Sarepta Therapeutics, in the press release statement.

The company will prioritize its siRNA platform assets, focusing on treatments for neurodegenerative and pulmonary diseases including facioscapulohumeral muscular dystrophy, myotonic dystrophy type 1, and Huntington’s disease. Several gene therapy programs for limb-girdle muscular dystrophy will be paused, though Sarepta still plans to submit a Biologics License Application for SRP-9003 for LGMD type 2E/R4 in the second half of 2025.

Sarepta also announced several executive leadership appointments, including Ian Estepan as President and Chief Operating Officer and Louise Rodino-Klapac as President of Research & Development and Technical Operations.

In other recent news, Sarepta Therapeutics is facing significant developments concerning its gene therapy Elevidys, following reports of two patient deaths due to acute liver failure. The U.S. Food and Drug Administration has initiated an investigation into these incidents, particularly affecting non-ambulatory Duchenne muscular dystrophy patients. As a result, Sarepta has paused the dosing of Elevidys for non-ambulatory patients and suspended its fiscal year 2025 product revenue guidance of $2.3-2.6 billion. Oppenheimer has responded by lowering its price target for Sarepta from $123 to $45 while maintaining an Outperform rating, due to the uncertainty surrounding the treatment’s safety and future market potential.

JPMorgan also adjusted its price target for Sarepta, reducing it from $30 to $28, citing a valuation disconnect but maintaining an Overweight rating. Meanwhile, Piper Sandler has retained its Neutral stance with a $36 price target, as safety concerns continue to be a topic of discussion within the DMD community. William Blair has downgraded Sarepta’s stock from Outperform to Market Perform, expressing concerns over the limited revenue potential amid growing uncertainties. These recent developments highlight the challenges Sarepta is facing in navigating safety concerns and market projections for its Elevidys treatment.

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