Sarepta Therapeutics' Elevidys Liver Deaths Trigger Selloff, A Contrarian Opportunity
Summary
- Sarepta's stock has plunged due to safety concerns with ELEVIDYS, including two deaths in non-ambulatory DMD patients and regulatory uncertainty.
- Despite these setbacks, ELEVIDYS remains effective for ambulatory patients, and Sarepta is proactively addressing safety via enhanced immunosuppression and trial amendments.
- Valuation appears depressed, with the market pricing in a worst-case scenario, but historical precedent (ZOLGENSMA) suggests recovery is possible if risks are managed.
- I maintain a Buy rating on SRPT for risk-tolerant investors, but recommend a barbell approach due to ongoing volatility and unresolved safety questions.
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