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The Sarepta Therapeutics Pipeline No One is Talking About

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The Sarepta Therapeutics Pipeline No One is Talking About

Few drug developers are more ambitious than Sarepta Therapeutics (SRPT) – Get Sarepta Therapeutics Inc. Report. The company has 34 pipeline projects spanning gene therapy, gene editing and RNA-based tools. While the company is primarily focused on muscle diseases such as Duchenne muscular dystrophy (DMD), it has more recently ventured into diseases affected by genes in the liver and brain. If its three approved drugs continue to grow revenue, the business could be profitable around mid-2000s.

Despite the breadth of the pipeline and portfolio, Wall Street analysts have trained investors to focus on one project: a gene therapy for DMD called SRP-9001. On the one hand, the program is financially important. Sarepta Therapeutics awards international development rights to Roche (RHHBY) $1.15 billion in upfront cash. It can also earn up to $1.7 billion in milestone payments, as well as royalties on future sales.

On the other hand, biotech stocks that are too reliant on a single pipeline plan have exposed investors to huge volatility. This has become a headache in recent years, as preliminary clinical data for SRP-9001 have been mediocre at worst and mixed at best.

Investors have no control over stock volatility. However, those who can control their emotions may see another major opportunity hidden in plain sight.

Next-generation approach to proven technology

Sarepta Therapeutics is developing a next-generation version of the tool, which has received three drug approvals from the U.S. Food and Drug Administration (FDA). Preliminary clinical data suggest that the first procedure may be 18 times more effective than existing drugs on key metrics.

Previous-generation tools: The company’s three FDA-approved products are based on RNA tools called morpholinos. If we take the nerdy chemical names of molecules, they get the acronym PMOs. Next-Generation Tools: Part of the company’s RNA pipeline is based on next-generation morpholinos. These molecules receive the abbreviation PPMOs.

Both PMO and PPMO work by preventing cells from reading instructions to make proteins. If the interrupted reading instruction encodes a mutation, the cell may be able to produce a functional protein. This could have therapeutic potential for diseases caused by simple, transient mutations that render defective proteins unable to function.

For example, DMD is caused by mutations in the dystrophin gene. Dystrophin is a protein that helps muscles function properly. Individuals with DMD have one of several mutations that cause dystrophin to become dysfunctional, resulting in progressive deterioration of muscle, heart and lung function.

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Sarepta Therapeutics-designed PMO drug skips instructions for making mutant dystrophin in three separate mutations. Although each resulted in increased production of working dystrophin, the results were controversial. Dystrophin levels in patients receiving Exondys 51 were 1% of normal.

Despite controversy in the scientific community, the company has received multiple approvals. The three drugs have combined product revenue of $612 million in 2021 and are expected to exceed $1 billion by 2023.

That’s what makes the emerging PPMO platform so exciting. Next-generation tools chemically modify traditional morpholinos to increase potency and reduce side effects. The lead drug candidate, SRP-5051, has yielded impressive results in clinical trials to date.

Patients receiving the highest dose of SRP-5051 blocked an average of 10.5% of the mutational mandate after 12 weeks of treatment. This represents an 18-fold increase compared to 24 weeks of Exondys 51 treatment. Patients receiving the highest dose of SRP-5051 achieved a mean dystrophin production of 6.5% of normal after 12 weeks of treatment. This represents an 8-fold increase compared to 24 weeks of Exondys 51 treatment. Patients received SRP-5051 every 4 weeks by intravenous (IV) infusion compared to weekly intravenous infusion of Exondys 51.

Sarepta Therapeutics believes SRP-5051 can deliver better results over a longer period of time. The company’s simulations showed that the PPMO compound achieved dystrophin levels of 14% of normal after 96 weeks of treatment. By comparison, the Exondys 51 was just over 1%.

It’s important to acknowledge two things. First, the success of the PPMO portfolio will come at the expense of currently approved drugs. There may be some cannibalization in revenue, but improved effectiveness and reduced dosing schedules could also lead to more patient visits and faster growth. In other words, PPMOs may have much higher peak annual earnings than their predecessors.

Second, SRP-5051 has a worrying side effect. Hypomagnesemia, or low levels of magnesium in the blood, has occurred in patients tested at the highest doses in ongoing clinical trials. This should be relatively easy to treat with monitoring and magnesium supplementation, but the FDA did recently pause a clinical trial to collect more data and possibly recommend changes to the study design.

In the worst case hypomagnesemia is caused by kidney damage. The kidneys process and clear PPMOs from the body, but their unique chemical modifications—the engineering decisions that make them the next generation of morpholines—may also cause them to clump together within these vital organs. Other key measures of the patient’s kidney function appear to be normal so far, but investors still need to pay close attention.

Keep an eye on Sarepta Therapeutics’ PPMO

Investors have been trained to focus on a gene therapy program called SRP-9001, but the PPMO platform represents a significant economic opportunity. Emerging tools bring important upgrades to proven, FDA-approved treatments. The result may be a combination of safer, more effective and more convenient treatment options for DMD patients. Importantly, commercializing PPMO could maintain Sarepta Therapeutics’ lead in DMD treatments, especially if gene therapies and gene editors from the company’s own pipeline or the competitive landscape prove less effective in upcoming clinical trials.

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