Baird Expects FDA Rejection for Drisapersen and Eteplirsen (BMRN) (SRPT)

Baird analyst, Brian Skorney, increasing belief is that the FDA is more likely to reject the NDA's for drisapersen and eteplirsen. He thinks the risk-reward is mildly skewed to the upside for BioMarin Pharma (NASDAQ: BMRN) (20% up/10% down) and massively so for Sarepta Therapeutics (NASDAQ: SRPT) (250% up/50% down).

Eteplirsen and drisapersen are meant to do the same thing for the same subgroup of patients with the same disease. One has a lot of clinical information. One has a fraction of that clinical information. Neither shows an indisputable clinical effect. Both are currently under review at the FDA. Considerations to take into account are the balance between standards for drug approval, in general, the unmet medical need, and political pressure with this heated and sensitive topic.

The FDA is expected to post its review tomorrow morning, ahead of Tuesday's advisory committee meeting. They believe the agency can sculpt the briefing documents to sway the panel one way or another. Look at the questions to determine how much flexibility the FDA will allow panelists: substantial evidence, reasonably likely, and a snowball's chance all have different connotations for approval flexibility. We would view word search hits for "toxicity," "data mining," "placebo effect," and "inconsistent" as red flags.

In a recent call with former Director of the FDA's Office of Orphan Product Development hh put the odds for both around 50/50, but his overall tone was much more negative.

No change to estimates, ratings or Price Targets.

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