Shares of Sarepta Therapeutics (SRPT) are up more than 31% in after-hours trade after the company announced that the FDA has requested more data in order to decide upon Eteplirsen approval. The market views this as a positive, thus the reason for being up so much in after-hours trade, but it is anything but positive.
About a few weeks ago the FDA postponed the decision on whether it wants to approve Eteplirsen or not to treat patients with DMD. Now the FDA is wanting dystrophin data, which the company says it can supply in a timely manner. The problem is that previous dystrophin data displayed by the company to date has not been great.
It is not a positive that the FDA is asking for dystrophin data. If the FDA felt it had enough data to approve Sarepta's drug then it would have done so right away. This request for additional data signifies that the FDA may feel it doesn't have enough efficacy data on hand to approve Eteplirsen in its current form. Remember, the FDA makes it decisions based on efficacy and data. The FDA doesn't trade on emotions, which is a common mistake a lot of investors make.
The FDA doesn't say " well this disease is bad, and there are no other treatments so we will just approve it just because". That's not how the FDA works; it goes by logic and data. If Sarepta's submitted dystrophin data doesn't meet the FDA's expectation then the drug will be outright rejected. With this new revelation tonight, the odds of Sarepta receiving approval gets smaller each day.
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