Needham downgrades Sarepta after patient death, questions management credibility

Needham downgraded Sarepta (SRPT) to Hold from Buy and removed the firm’s prior $50 price target after it was reported that a 51-year-old male with limb-girdle muscular dystrophy type 2D/R3 died last month due to liver failure after receiving Sarepta’s gene therapy. Though the safety event was not disclosed during Wednesday’s update, Sarepta provided more details on a call this morning and management noted the FDA was aware of the death when it recommended adding a Black Box warning to Elevidys’ label. The firm, which calls it “particularly concerning” that Sarepta did not disclose this death during a company call earlier in the week, thinks the new information casts further uncertainty on Elevidys’ commercial potential and raises concerns on Sarepta’s management credibility.