Potential Paradigm Shifting Technology from a Small Biotech

By Kanak Kanti - August 2, 2013 | Tickers: GSK, RNA, SRPT | 0 Comments

Kanak is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.

Two biotech companies, Sarepta Therapeutics (NASDAQ: SRPT) and Prosensa Holdings (NASDAQ: RNA) are involved in a race to be the first to get their candidate approved for treatment of DMD, a rare recessive form of muscular dystrophy. However, what is involved is a lot more than just the financial angle. Approvals of these two drugs can potentially change the focus of future research in discovery of new drugs.

Sarepta Therapeutics, a company engaged in development of RNA-based therapeutics, recently got the go-ahead from the FDA for filing a new drug application (NDA) for its candidate for treatment of Duchenne muscular dystrophy (DMD), eteplirsen, on the basis of existing studies, and will be submitting the NDA in the first half of 2014.

Drisapersen of Prosensa, a Dutch biotech company, which was granted Breakthrough Designation by the FDA last month, is the other drug in the race. The global pharmaceutical giant GlaxoSmithKline (NYSE: GSK) holds the license for developing and commercializing drisapersen. A 100+ billion dollar company, GlaxoSmithKline has recently had the misfortune to be involved in a number of controversies that has harmed its global image. Last year, there was the $3 billion settlement money it had to pay in the US for large-scale fraud related to illegal drug promotion, bribery etc. This year, there is the news about the China bribery angle, another issue that might negatively impact the company.

Anyway, the breakthrough status was important for both Glaxo and Prosensa as drisapersen and Sareptas eteplirsen are the two closely watched drugs by the investors, scientists and the DMD community. The FDA is under pressure from lawmakers to work closely with the development teams working on breakthrough designated drugs, particularly drugs for orphan diseases. While drisapersen is in a pivotal stage of clinical trials, investor attention increased in eteplirsen after encouraging mid-stage data.

Earlier, in October, Sarepta released data of trials of eteplirsen that demonstrated marked improvement in walking ability of patients with DMD. Ever since, everyone, scientists, market analysts and investors, have been tracking the progress of eteplirsen and in absence of other treatments for DMD were expecting that FDA might agree for a quick approval and allow Sarepta to skip late stage trials.

However, the July 24, 2013 announcement clarified that the FDA refused to commit to declaring dystrophin an acceptable surrogate endpoint under the CFR 314 Subpart H Accelerated Approval pathway prior to an NDA filing. Evidently, the sanction for filing NDA only indicates that there is merit in the data provided by the company and the drug deserves review.

FDAs refusal to accept that available data was sufficient for fast tracking the review process shattered hopes and the companys stock, which had gained an amazing 336% in one year, lost 18% since then.

Both drisapersen and eteplirsen work by increasing the amount of dystrophin a protein, lack of which is the major cause of DMD through an action known as exon skipping.

Read the rest here:
Potential Paradigm Shifting Technology from a Small Biotech