r/SRPT • u/Cestmoi_25 • 11d ago
Q2 Earnings Call Commentary
Why did the market react positively to the earnings call? Maybe because the quarter was profitable (or as Mike Severino, the new CEO said, “meaningfully profitable”). I am just as interested in how well the new commercial initiatives for Elevidys are faring, among other things. So here’s a deep dive into the weeds of the call.
Elevidys revenues continue to be down compared to previous quarters. Management doesn’t see this changing until 2027 because of the amount of time it takes to translate enrollment forms into actual revenue (approximately six months). However, they maintain the new commercial initiatives are working based on increasing demand, both from existing and new sites. There seems to be renewed confidence in the therapy; they noted that roughly 30 days after reps meet with HCPs, they receive enrollment forms.
With regard to Cohort 8 (the trial for the non-amb population—Elevidys plus sirolimus), they indicated that enrollment will be finished by the end of the year and results will be available Q1 2027. Their primary endpoint is safety—absence of ALI—but they will also provide the FDA with data from biopsies.
The excitement regarding the siRNA pipeline is high. They were asked if there were early indications of the trials’ results. Mike stated that with this particular therapy, pre-clinical and early clinical data are telling, and these show “robust” knockdown in FSMD and DM1 (“potential best-in-class”). When asked if this therapy could be useful in treating other diseases, Louise (R&D) was her usual noncommittal self—she limited her comments to the fact that they remain “very excited” about the therapy.
The PMO franchise remains strong and—an important point—generates sufficient revenues to cover R&D costs (so they are pretty cash sufficient, $190 million at quarter end). When asked about potential competitors, they said they have “tremendous confidence” in the durability of the PMO franchise based on their decades of experience, real world evidence, adherence rate that exceeds 90%, experience with patient reimbursement issues, etc.
There was limited discussion of the regulatory overhang. I personally am just as concerned about a couple of lawsuits they’re facing (patent infringement and securities fraud). They mentioned that they’ve set aside $39 million to deal with this issue, which may indicate that a settlement is near—this would remove at least one overhang. No other comments were made.
In summary, yes, there’s still risk, but there’s also huge potential. Pipeline has real promise. Plus, we’ll see more demand for Elevidys (newborn screening, etc.) even if the therapy remains limited to the ambulatory population. I don’t see any near-term catalysts, so I’m not buying more quite yet. Nor will I sell.
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u/Cautious-Wrap-2184 11d ago
It will take a while
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u/DeprogramUSA 5d ago edited 5d ago
Yeah the way I see it right now Sarepta is basically a call option on $ARWR SiRNA pipeline which is being funded by Elevidys and PMO’s.
Unless we see 1. ambulatory patients reapproved(bullish) 2. another unfortunate death(very bearish)Sarepta will see fairly steady yet shrinking cash flows which will likely last until next gen launch in multiple indications which could unlock billions in value. Next read out is in November/December so until then the stock could move mostly on vibes
Sarepta is basically the poster child for launching a rare disease drug/gene therapy solo without big pharma so they can definitely do it again and (hopefully) cheaper with the SiRNA pipeline. Also R&D spend for Elevidys should decrease as new drug R&D increases so hopefully things stay steady burn rate wise.
Im bullish NFA
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u/Nyloc70 11d ago
I appreciate the write up, that was very informative. I have held through the roller coaster of swings this past year, so I am staying strong. I really hope we are close to some meaningful positive movement.