Historically, drug companies like Sarepta would need to plan a Phase III study comprising far more patients than the Phase II before approaching regulators to file an NDA (New Drug Application). However, in the case of young boys reaching puberty and just beginning to suffer the life-threatening effects of DMD, waiting for a comfirmatory study before marketing the drug would amount to a death sentence.
With the passage of the FDA Modernization Act of 1997 (FDAMA) and amended in 2012 by the FDA Safety & Innovation Act (FDASIA), Congress created a pathway for rare diseases to receive fast track and accelerated approval (AA). Sarepta has made it clear that they intend to petition the FDA to allow the company to apply for AA and have a meeting with the FDA on this very topic scheduled shortly.
What are the conditions necessary to meet the requirements for AA? Sec 901 of FDAMA and FDAISA govern access to AA. Section 902 complements 901 by allowing expedited developement of ‘Breakthrough Therapies’ that benefits drugmakers by giving them frequent, prioritized access to FDA staff to help expedite the approval process.
Section 901 lays out three broad criteria that need to met in order to achieve AA status. The disease in question must be rare and life threatening. A surrogate endpoint needs to be identified that is reasonably likely to predict clinical benefits to prospective patients. And lastly, safety data is carefully weighed on a risk vs. benefit analysis, taking into account the needs and viewpoints of patients.
Section 902 works hand in hand with Section 901 by allowing a company access to FDA staff in order to ensure the most efficacious method to reach AA compliance. Importantly, Section 902 directs that clinical trials be both small and efficient (in the words of the statute “by minimizing the number of patients exposed to a potentially less efficacious treatment”)
It is clear to me that by all accounts a succesful treatment for Duchenne’s meets the criteri
Options pricing can be an extremely useful tool in analyzing what the current expectations are for this market-moving piece of information to be released. If you look at the difference in pricing between the March, April & May 35 calls, you will see a clear jump in premium and associated volatility starting in April. Therefore it is reasonable that the specialists making a market in Sarepta options expect a decision by the FDA to be released sometime after March 16th, the expiration of the March series of options.
Normally I would agree with the pricing in options on such a speculative and closely-watched name like Sarepta. However, I believe in this case there are a number of key upcoming catalysts that could both put the March options ‘in play’ as well as yield a short-term bounty to Sarepta stockholders.
On Monday, March 4th, the company will speak at the Cowen Health Care Conference in its’ hometown of Boston. On Thursday March 7th, the company will release earnings along with a corporate update. Either venue would be a good place to update shareholders as to the status of the AA meeting. It is highly probable, that the meeting will have already taken place by the time of the earnings announcement, and any body language or comforting comments around the process would be taken seriously by Wall Street.
It is also possible that Sarepta releases additional data on the ongoing open-label extension study with the original 12 patients. The extension study continues to #$%$ the long-term safety and efficacy of open-label eteplirsen. The 6MWT continues to be performed every 12 weeks, and it is possible that the company releases that data publically. In the December 7th release of data, a continued benefit on the 6MWT was shown to exist through 62 weeks and if it continues to be replicated over time will add urgency to the push to get this drug fast tracked.