January 10, 2017: Baird reiterates a Buy rating on biotechnology firm Sarepta Therapeutics and set a price target of $102. Baird named Sarepta Therapeutics 2017 top mid-cap pick. Sarepta has dystrophin data coming from SRP-4053 in exon-53-amenable patients in 1H17, and data plans to advance at least three additional assets, two of which were announced today, into the clinic in 2017. First, the internal PPMO assets. Preclinical data presented today in two different animal models, MDX mice and non-human primates highlight what appears to be broad tissue penetration and clearly improved dystrophin expression. If this result is replicated in the clinic, it would clearly put Sarepta even further in the lead against the competition in DMD. Today’s two new deals mark Sarepta’s first foray into gene therapy. Both partnered assets are out of Nationwide Children’s Hospital (Mendell and Flannigan) and represent potential microdystrophin and GALGT2 approaches.
Baird’s $102 price target is based on their view that the company’s lead drug candidate, eteplirsen, is the best shot of the disease-modifying therapies to provide a benefit to patients with Duchenne Muscular Dystrophy. Baird views the combination of drug/indication as commercially ideal where the patient population is readily identified, the unmet medical need is high, the treatment is likely to be lifelong and the market will be insensitive to price. Baird believes successful development of eteplirsen supports a high likelihood that the company will successfully expand its technology to a much larger DMD patient population given the underlying characteristics of the disease and Sarepta’s technology.
January 10, 2017: Credit Suisse reiterates an Outperform rating on Sarepta Therapeutics. Sarepta presented Q4 sales today and Credit Suisse thinks that sales were roughly in line with expectations at around $5 million. Credit Suisse says it was higher than their estimate of $1 million which assumed about 10 patients were on treatment at an annual estimated net price of $766K. Credit Suisse thinks demand update of 250 patients is a good start and that the 8% rate of payers rejecting scripts was encouraging as well. 79% of lives are pending decisions, reviewing case by case, or approved with restrictions. By firms calculations, they have about 241 patients leaving 2017 at an estimated annual net price of $700K. Increased patient conversion is a major focus for the company and we expect this is an important factor for the 250 patient start forms heading into 2017. The upside would come from whether demand continues to ramp and also if the time to script conversion shortens to the low end. Firm also thinks that the stock would get a boost from any positive resolutions on the payer front. They think that Anthem will come around with time and note that United will not begin reimbursing until February. 2017 set up for shares includes tracking US launch trends and Exon 53 phase 1 data expected in mid-2017.
January 10, 2017: Sarepta Therapeutics reports as of December 31, 2016, the Company generated approximately $5.4 million in revenue (unaudited) from sales of Exondys 51TM and had cash, cash equivalents and investments of $329.3 million (unaudited). Sarepta has over 250 genetically verified start forms since launch of Exondys.
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Sarepta Therapeutics is a biopharmaceutical company focused on the discovery and development of unique RNA-targeted therapeutics for the treatment of rare, infectious, and other diseases. The Company is primarily focused on rapidly advancing the development of its potentially disease-modifying DMD drug candidates, including its lead DMD product candidate, eteplirsen, designed to skip exon 51. Sarepta is also developing therapeutics for the treatment of drug-resistant bacteria and infectious, rare and other human diseases.