Sarepta Therapeutics (SRPT.O), will cut 500 jobs and add a serious warning on the label of its muscle-disorder gene therapy Elevidys, the drugmaker said on Wednesday, following the recent deaths of two patients who were on the medicine.
The U.S. Food and Drug Administration asked Sarepta to include the “black-box” warning, its most serious, for the risk of acute liver injury and liver failure in patients with Duchenne muscular dystrophy who can walk.
Sarepta shares shot up 33% in extended trading, as the company also said its restructuring efforts would reduce annual costs by about $400 million in 2026.
As part of the restructuring, the company promoted insider Ryan Wong as chief financial officer. Wong was serving as senior vice president of investor relations.
It has also halted development of several gene therapies for a group of muscle wasting disorders called limb-girdle muscular dystrophy.
The company has faced heightened regulatory scrutiny after two patients treated with the muscle disorder therapy died from acute liver failure, casting doubts on the treatment’s safety and future demand. Both patients were non-ambulatory, or unable to walk independently.
“We saw some canceled appointments after the second event, and that obviously results in some hesitancy (among physicians),” CEO Doug Ingram said on a call with analysts.
The company said it plans to submit a proposal to the FDA to treat non-ambulatory patients with a drug that suppresses the immune system prior to infusion with Elevidys.
Evercore ISI analysts said the announcement removes the downside scenario of the therapy getting pulled from the market for ambulatory patients.
The company had suspended its Elevidys sales forecast for 2025 and halted shipments to non-ambulatory patients last month.
Sarepta said it has “more work to do and more dialogue to be had with the FDA” to continue shipping for non-ambulatory patients.
While it did not issue formal guidance on Wednesday, Sarepta forecast annual Elevidys revenues of at least $500 million from the ambulant population through 2027, calling it a “stress test”.
