Sarepta Under Pressure As FDA Approves Marathon Pharma's Emflaza For DMD Treatment

Shares of Sarepta Therapeutics Inc (NASDAQ: SRPT) dropped 2 percent Thursday on news of the FDA’s approval of Marathon Pharmaceuticals' Duchenne Muscular Dystrophy treatment. Emflaza previously secured priority review and orphan drug status, and the FDA green-lighted the product for immediate marketing.

The generic formula — a steroid known as deflazacort — endured heavy scrutiny by the Administration despite its wide availability in Canada and the United Kingdom.

"This is the first treatment approved for a wide range of patients with Duchenne muscular dystrophy," said Billy Dunn, director of the Division of Neurology Products at the FDA. "We hope that this treatment option will benefit many patients with DMD."

Given the move lower in Sarepta shares Thursday afternoon following the Emflaza news, some investors may have assumed it and Sarepta's DMD treatment, Exondys, could be competitors. This, however, is not the case as Exondys treats the actual disease. 

Sarepta’s stock has recovered from Thursday’s post-news plunge, and shares are now trading down 0.15 percent on the day.