Sarepta Presents 48-Week Data For Duchenne's Drug At World Muscle Society Congress

| About: Sarepta Therapeutics, (SRPT)

Duchenne's Muscular Dystrophy [DMD] is a genetic disorder that afflicts approximately 1 out of every 3,600 male infants. The inherited disease is caused by mutations in the gene for dystrophin- a muscle protein- resulting in muscle weakness at an early age that quickly worsens over time. Breathing difficulties and heart disease typically begin in the early twenties, eventually leading to death.

Sarepta Therapeutics (NASDAQ:SRPT), formerly Avi BioPharma, has developed an RNA-based therapy designed to allow DMD patients with specific deletions in the dystrophin gene to produce active forms of the protein. Genes are comprised of exons and introns; during the translation process from DNA to protein, pre-mRNA is assembled, introns are removed and exons are spliced together to form mRNA, which is then used as a template to create proteins.

In patients with DMD, the errors can lead to what's called an out-of-frame, or frame-shift deletion. Cells read the genetic code in sets of three nucleotides. If an exon deletion causes this set of three to become out of step, every subsequent read will be incorrect and no protein will be made. Sarepta's exon-skipping technology can correct the reading frame, allowing functional protein to be produced. The company's lead compound eteplirsen (AVI-4658) enables the skipping of exon 51. Additional compounds targeting other exons are also in development.

Earlier in the year, Sarepta presented short-term data for Eteplirsen. Long-term safety and efficacy results were presented this Saturday at the WMS Congress in Persh, Australia. We had already learned from a press release of top-line results October 3rd that results were positive: 50mg/kg treated patients remained stable- perhaps improved on the 6MWT- and treatment delayed patients appeared to have stabilized; dystrophin expression improved across all cohorts. While there are still questions remaining, the overall picture from Saturday's presentation appears positive. It is unfortunate we were unable to attend or view the live discussions.

The primary endpoint is percent dystrophin positive fibers, with a clinical outcome measured by the 6-minute walk test (6MWT). The three original cohorts have become two active treatment arms of either 30mg/kg or 50mg/kg Eteplirsen. It is important to note many later analyses exclude two patients from the 30mg/kg arm due to their initial rapid deterioration. As it turns out, the two are identical twins. The boys remain on study and continue to receive drug as well as monitoring. Pulmonary function of both subjects have remained stable through the 48-week extension.

Below is a key piece of data describing individual dystrophin levels showed robust data. Increase in dystrophin positive fibers occurred in all 12 patients in a clear, time-dependent manner. No dose-response is apparent.

Additional measures including immunofluorescence, western blot, and RT-PCR all confirmed production of new dystrophin. A bit of fuss was made over the apparently low level of protein seen in the western blot and low RNA in the PCR assay.My only critique is Sarepta's poor labeling; the Normal Control lane in this Western Blot, appears to be in the far left. Also, Mandys106 is an antibody for the detection of dystrophin. For those who want a bit more detail, Actin acts as a "loading control" to help normalize each lane for analysis- lots of actin means large amounts of protein was loaded in the lane and needs to be accounted for. In this blot, even the small amount of dystrophin is more than it appears compared to normal control. But this does not mean insufficient amounts of dystrophin is being made. For one thing Mandys106 is designed to bind normal dystrophin, it is uncertain how well it binds to the truncated form created by an exon skipping drug.

If we take a look at PRO051 from Prosensa, which is partnered to GlaxoSmithKline (NYSE:GSK), we can see that similarly low amounts of dystrophin are detected. This blot is from patient samples taken at 24 weeks. Notice the high amounts of protein loaded in each lane for patients compared to control.

What's lacking are individual 6MWT scores, but this is because data is still being collected in the trial and the company is attempting to limit bias from parents influencing their children's performance . The apparent improvement from 36-week to 48-week for both the 50mg/kg and treatment-delayed arms may simply be a blip and require further assessment. We have the mean data, now it is important to know if some boys fare much better, or worse, than others. The company will need to be more forthcoming with this. In particular, why is the 30mg/kg arm completely absent? Why isn't the delayed treatment arm broken into 30mg/kg vs. 50mg/kg? It would be fantastic to see curves for each of the 12 patients. Unfortunately, we will likely have to wait to see these results.

In the end, Eteplirsen maintains its crucial safety profile. There are no signs of kidney, liver, muscle, cardiac, or other measured toxicities. But as with any treatment where new proteins are introduced into the body, Eteplirsen can potentially elicit an immune reaction. For this reason, all study participants had been tested for immunogenicity against dystrophin. Steroids taken by most DMD patients also appear to lessen the risk of a reaction.

The big question now is whether Sarepta will be able to secure an Accelerated Approval path for Eteplirsen. The need is compelling and the results look good, but was the trial "adequate and well controlled"? This is the subject of heated debate. On the one hand, there is no arguing Eteplirsen is active; it induced dystrophin formation in 100% of treated patients. And amazingly, the course of disease appears to have changed for the four delayed treatment patients. Yet of 8 patients who received drug for the entire 48-weeks, only 4 stabilized (that's assuming all 4 boys in the 50mg/kg arm did well). And within this small group, evidence from a slew of family videos show boys previously limited by their disease to be thriving.

Up-coming Developments:

Later this week we hope to learn substantially more in a couple investor calls hosted by Wedbush with DMD expert Dr. David McDonald on Wednesday October 17, and CEO, Chris Garabedian, and Ed Kaye, CMO on Thursday October 18.

While investors agonize over the trial results, manufacturing of Eteplirsen is becoming increasingly important. A contract manufacturer has been brought in to assist with scaling up production to commercial levels. Any details of Sarepta's manufacturing capabilities would be welcome.

Perhaps the most important upcoming event will be Sarepta's post Phase II meeting with the FDA either late this year or early 2013. Management will press their case for a quick path to market; with in months, we will know if the FDA is in agreement. Accelerated approval would be unprecedented for a trial of this size. The Agency will be under enormous pressure from advocacy groups as well as politicians to make the drug available. At the same time, it is tasked with ensuring the public's safety. As of right now, with such a small number of test subjects, AA is certainly not a slam-dunk proposition. The end of Phase II meeting will provide clarity on this crucial matter.

An additional set of 6MWT data may also become available in December- this one at 60 weeks. With few patients, every data point bares increased importance. The 60-week time-point has the potential to confirm what appears to be a reversal in declining 6MWT scores of the delayed treatment cohort. In our view, this would demonstrate an amazing clinical benefit. The test can also confirm early signs of improvement in the 50mg/kg group; taken together, they have the potential to offer strong support for accelerated approval.

There is a lot to look forward to in the ensuing months. We remain bullish on Sarepta and believe it is undervalued relative to peers.

Disclosure: I am long SRPT. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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