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Sarepta Therapeutics shares after treatment update

The Associated Press

Shares of Sarepta Therapeutics Inc. slid Friday, even though the company announced more positive results from a study of its Duchenne muscular dystrophy drug eteplirsen.

THE SPARK: The Cambridge, Mass., company said Friday patients treated with eteplirsen for more than a year did better on a six-minute walking test than those treated with a placebo for 24 weeks and the drug for 38 weeks in the extension of a mid-stage trial.

THE BIG PICTURE: Duchenne muscular dystrophy is a genetic disease that causes increasing muscle weakness. It is caused by a lack of the protein dystrophin, and it affects only boys.

The condition occurs in about 1 of every 3,600 male infants. The National Institutes of Health say patients typically die before the age of 25.

Sarepta's stock nearly tripled in value in early October after it said eteplirsen slowed the progress of the disease and increased patients' dystrophin levels. The shares also jumped in July when the company announced some initial results of the trial extension.

Eteplirsen is the most advanced drug candidate for Sarepta, formerly known as AVI BioPharma.

THE ANALYSIS: Steve Brozak of WBB Securities said the stock is suffering a little bit from "news fatigue."

"This is really important technology, but the end numbers are so small," he said noting that the study involved only 12 patients.

Brozak noted that there's still uncertainty over how regulators will view the treatment, and some investors may be selling shares to take profits ahead of any potential increase in capital gains taxes next year.

SHARE ACTION: Down 5 percent, or $1.38, to $26.10 in afternoon trading, while the Nasdaq exchange fell less than 1 percent. That's still a considerable jump from the stock's $3.46 closing price on July 23.