SRPT Slides on Voluntary US Elevidys Shipment Pause Amid Scrutiny

Shares of Sarepta Therapeutics SRPT are declining in the pre-market hours today after the announcement that it will voluntarily and temporarily halt all U.S. shipments of Elevidys, effective at the close of business today. The drug is SRPT’s one-shot gene therapy for Duchenne muscular dystrophy (“DMD”).

Sarepta stated that the voluntary pause is a proactive measure to allow sufficient time to address any information requests and to complete the Elevidys safety labeling supplement process with the FDA. SRPT expressed its commitment to a collaborative, science-based review and ongoing dialogue with the agency.

This marks yet another major setback for Sarepta, with serious implications for its revenue-generating potential. The company relies heavily on Elevidys to drive top-line growth, with the therapy contributing over half of total revenues in the first quarter of 2025. The voluntary pause in U.S. shipments is expected to significantly impact Sarepta’s financial performance in the second half of the year.

SRPT Halts US Elevidys Shipments Amid Mounting Setbacks

The decision to temporarily halt U.S. shipments of Elevidys comes on the heels of the death of a patient dosed with one of its experimental gene therapies. Last week, Sarepta confirmed that a 51-year-old, non-ambulant (unable to walk) limb-girdle muscular dystrophy (“LGMD”) patient died due to acute liver failure (“ALF”). The unfortunate event occurred in a phase I study of the investigational gene therapy candidate, SRP-9004, which is being developed for LGMD Type 2D.

This marked the third patient death confirmed by Sarepta from the use of its gene therapies. Earlier this year, SRPT reported two cases of patient death following treatment with Elevidys for DMD. Like the latest death, the two earlier deaths were also due to ALF and occurred in non-ambulatory patients.

Based on these incidents, the FDA placed all Sarepta’s clinical studies for LGMD on hold. The regulatory body cited the deaths, potentially tied to ALF, following treatment with gene therapies using the AAVrh74 serotype found in Elevidys as the reason for its action. The agency determined that participants in these studies may face an unreasonable and significant risk of serious illness or injury.

Considering the emerging safety concerns, the FDA requested that Sarepta voluntarily stop all shipments of Elevidys in the United States. Despite initially defying the request, SRPT ultimately complied.

Year to date, Sarepta’s shares have plunged 89% compared with the industry’s 2.2% decline.

Following the first two deaths, Sarepta has already suspended Elevidys dosing for non-ambulatory patients in the commercial setting and has been considering an enhanced immunosuppression regimen to make the therapy safer. It has also voluntarily paused dosing in the ongoing late-stage ENVISION study designed to satisfy the regulatory requirements for Elevidys outside the United States. This study is evaluating the therapy in non-ambulatory and ambulatory DMD patients. The therapy has been mandated by the FDA to carry a black box warning for ALF and acute liver injury.

Elevidys is the first and only one-time gene therapy for DMD in the United States. It is currently approved for use in individuals aged four years and older, regardless of ambulation status. While the therapy has been granted full approval to treat ambulatory DMD patients, it has only received accelerated approval for use in non-ambulatory patients. The ENVISION study is expected to serve as the confirmatory study for converting this accelerated approval to a full one.

Sarepta developed Elevidys in partnership with pharma giant Roche RHHBY. In 2019, the company and Roche entered into a licensing agreement to develop Elevidys. Per the agreement, Roche has exclusive rights to launch and market the therapy in non-U.S. markets.

SRPT to Cut Costs & Focus on siRNA Pipeline

Last week, Sarepta announced a major restructuring plan aimed at improving long-term financial sustainability. The company will cut 36% of the workforce, about 500 employees, generating annual savings of $120 million and reprioritize its pipeline to save an additional $300 million per year, totaling to about $400 million in expected yearly savings by 2026.

As part of this shift, Sarepta is now focusing on its siRNA pipeline acquired through the recent deal with Arrowhead Pharmaceuticals, which includes several clinical and preclinical programs targeting conditions like facioscapulohumeral muscular dystrophy, idiopathic pulmonary fibrosis, myotonic dystrophy type 1, spinocerebellar ataxia 2 and Huntington’s disease. Initial clinical data from the studies of some of the acquired candidates are expected by year-end. Despite incurring up to $37 million in one-time charges, Sarepta anticipates more than $100 million in cost savings this year and projects 2026 adjusted R&D and SG&A expenses to be between $800 million and $900 million.

Sarepta Therapeutics, Inc. Price and Consensus

Sarepta Therapeutics, Inc. price-consensus-chart | Sarepta Therapeutics, Inc. Quote

SRPT’s Zacks Rank & Stocks to Consider

Sarepta currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the biotech sector are Verona Pharma VRNA and Bayer BAYRY, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 90 days, Verona Pharma’s bottom-line estimates for 2025 have significantly improved from a loss of 7 cents to earnings of 22 cents. During the same timeframe, estimates for 2026 earnings per share have improved from $2.21 to $2.88. VRNA stock has soared 125.9% so far this year.

Verona Pharma’s earnings beat estimates in one of the trailing four quarters and missed the mark on the other three occasions, delivering an average negative surprise of 6.76%.

BAYRY’s 2025 earnings per share estimate has increased from $1.19 to $1.30 for 2025 over the past 90 days. The same for 2026 has risen from $1.28 to $1.35 over the same timeframe. Year to date, shares of Bayer have surged 63.3%.

BAYRY’s earnings beat estimates in one of the trailing four quarters, matched twice and missed on the remaining occasion, the average negative surprise being 13.91%.

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