New-look Sarepta eyes approval for muscular dystrophy drug

By Zeba Siddiqui

(Reuters) - After three decades without bringing a drug to market, Sarepta Therapeutics Inc stands on the verge of a breakthrough with its treatment for a crippling genetic disorder that affects one in every 3,500 newborn boys.

If U.S. regulators fast-track approval of its treatment for Duchenne muscular dystrophy, as some investors are betting, it would complete a remarkable turnaround for the company that began life as AVI Biopharma in Corvallis, Oregon, 33 years ago.

Sarepta's stock has more than doubled in value since October, when its drug, eteplirsen, yielded positive results in a mid-stage trial. The company has a market capitalization of $1.1 billion.

Duchenne muscular dystrophy, or DMD, is classed as an orphan disease -- a condition affecting fewer than 200,000 people. More than a quarter of the 39 new medicines approved in the United States last year were designated for such diseases.

It's an area that has grabbed the attention of drug developers in search of a unique product that can command a high price. There are no approved treatments for DMD.

"Sarepta has the product and development platform necessary to join the ranks of other successful companies that target rare diseases," William Blair & Co analysts said last month as they launched coverage with an "outperform" rating on the stock.

The company also has renewed focus, analysts say -- something that Chief Executive Chris Garabedian says was missing when he took over on January 1, 2011.

"At that time, the company's potential was under-appreciated, because we didn't have robust clinical data in any disease area and our business lacked focus," he told Reuters.

Garabedian, formerly vice-president of corporate strategy at Celgene Corp, arrived at Sarepta - then AVI - following a management shake-up led by private investor George Haywood and Meldrum Asset Management. The name-change followed in July 2012.

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New-look Sarepta eyes approval for muscular dystrophy drug