Sarepta Therapeutics Inc (NASDAQ:SRPT) shares plunged almost 45% after the company disclosed the death of a second patient from acute liver failure linked with its experimental gene therapy Elevidys for Duchenne muscular dystrophy (DMD).
In response, the company is convening an independent expert panel to evaluate and develop an enhanced immunosuppressive regimen, including sirolimus, to reduce the risk of acute liver failure in non-ambulatory DMD patients treated with Elevidys, with any new protocol subject to Food and Drug Administration (FDA) review and approval.
It has suspended shipments of Elevidys in non-ambulatory patients until an enhanced regimen is approved, about half of the market, and also paused its Envision clinical trial while seeking a protocol amendment.
“We are taking immediate, decisive steps to better understand and mitigate the risk of acute liver failure, including enhancing the immunosuppressive regimen, for those with Duchenne who are non-ambulatory,” Sarepta's chief scientific officer Dr Louise Rodino-Klapac said in a statement.
Analysts at Jefferies believe the second patient death threatens Elevidys’ commercial growth, casts doubt on its full approval timeline for non-ambulatory DMD, and may limit peak sales potential.
“Although acute liver injury is a known possible side effect of AAV gene therapies broadly, the second death will strengthen the notion a negative safety event is simply unpredictable with gene therapies, making it challenging to invest in this space,” they wrote.
“Arguably, investors will unlikely entertain the notion that the two deaths within a span of three months are an idiosyncrasy.”
Further, Elevidys’ benefit/risk calculation has worsened with the increased safety risk. “Indeed, Roche confirms the benefit/risk remains positive in ambulatory DMD but ‘unfavorable’ in non-ambulatory DMD,” the analysts wrote.
Jefferies also noted that recent additions of over 100 new global patients between March and June 2025 likely generated around $240 million in revenue, which already falls short of Sarepta’s second quarter sales guidance of approximately $300 million.
This sales slowdown, along with the new safety overhang, may derail previous assumptions of accelerating revenue in the second half of the year and cast doubt on whether the company can meet its already-lowered 2025 guidance of $1.4 billion to $1.7 billion.
Shares of Sarepta Therapeutics traded down 44.6% at about $20 shortly after US markets opened on Monday.