Business Corpus: The Biotech Just Broke Out On Hype Surrounding Its Muscle Disease DrugsSarepta rocketed to an 18-year high Friday amid furor surrounding its newest treatments for a fatal disease called Duchenne muscular dystrophy. The post The Biotech Just Broke Out On Hype Surrounding Its Muscle Disease Drugs appeared first on Investor's Business Daily.

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Sarepta Therapeutics (SRPT) rocketed to an 18-year high Friday and broke out amid furor surrounding its newest treatments for a fatal muscle-wasting disease called Duchenne muscular dystrophy.

On the stock market today, Sarepta popped 14.8% to close at 89.75. Earlier, the stock hit an 18-year high, rising as much as 16.4%. Shares soared past a buy point at 83.98 out of a cup-with-handle. Biotech stocks collectively lifted 1.5%.

The stock pop followed Sarepta's first-quarter earnings report. Sales of its only commercial drug, Exondys 51, came in at $64.6 million, below the consensus of analysts polled by Zacks Investment Research for $65 million, but above other estimates.

Meanwhile, "others exons are moving quickly," JMP Securities analyst Liisa Bayko said in a note. Sarepta's Exondys 51, golodirsen and casimersen work by skipping over faulty or misaligned sections of genetic code and are referred to as exon-skipping drugs.

Golodirsen, Casimersen On Track

Sarepta is on track to finish submitting a rolling application for golodirsen by year-end. It also plans to ask the Food and Drug Administration for guidance in a study of casimersen called Essence. Researchers are examining both as Duchenne muscular dystrophy treatments.

"If the FDA OKs the process and casimersen biopsies replicate preclinical data, the exon 45 skipper could also be submitted for approval with Essence, serving as a confirmatory trial for both golodirsen and casimersen," she said.

Piper Jaffray analyst Edward Tenthoff projects $35 million in golodirsen sales in 2019. He kept his overweight rating and 83 price target on Sarepta stock. JMP's Bayko, though, cut her price target to 90 from 95. She has an outperform rating on Sarepta.

The trouble is, "it was not all sunshine for the exon 51 skipper," known as Exondys 51, late Thursday, Bayko said. A European advisory group put out a negative trend vote on Exondys 51, saying the drug didn't meet the regulatory threshold for conditional approval.

Analysts Split On Exondys 51

Analysts have varied views on whether European officials will approve Exondys 51. Leerink analyst Joseph Schwartz called the news late Thursday "a mostly expected blip."

He cut his price target on Sarepta to 88 from 92, but reiterated his outperform rating.

"We believe eteplirsen (Exondys 51) could ultimately prevail at the European Medicines Agency," he said in a note. "Management will convene and seek input from the scientific advisory group that can contextualize the significance of their clinical data package."

JMP's Bayko is less bullish.

"We expect the re-examination to the completed around year-end 2018, but we think an approval is less likely and thus we lower our probability of success for Exondys 51 in Europe to 40% from 80% and push back an expected launch to 2021 from 2019," she said.

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The post The Biotech Just Broke Out On Hype Surrounding Its Muscle Disease Drugs appeared first on Investor's Business Daily.