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Sarepta (SRPT) Q2 Earnings Beat, 2021 Sales View Raised

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Sarepta Therapeutics, Inc. (SRPT - Free Report) reported loss of $1.02 per share for the second quarter of 2021, narrower than the Zacks Consensus Estimate of a loss of $1.03 per share. The loss was also narrower than the year-ago loss of $1.93 per share.

The company incurred adjusted loss of $1.52 per share, wider than loss of $1.51 in the year-ago quarter Notably, the adjusted figure excludes one-time items, depreciation & amortization expenses, interest expenses, income tax benefit, stock-based compensation expense and other items.

Sarepta recorded total revenues of $164.1 million, up 19.5% year over year. Revenues beat the Zacks Consensus Estimate of $147.4 million. The increase in revenues was driven by the stronger-than-expected launch uptake of Amondys 45 and continued demand for Sarepta’s other two drugs — Exondys 51 and Vyondys 53. The company also raised its guidance for revenues for 2021 following the strong demand trends for its drugs.

The company is also progressing well with lead gene therapy pipeline candidate — SRP-9001. The company announced on the earnings call that it expects to initiate a pivotal late-stage study on the candidate in September.

Shares of Sarepta gained 3.7% in after-hours trading, presumably on increased revenue guidance and announcement of pivotal study on SRP-9001. However, Sarepta’s shares have declined 60.4% so far this year against the industry’s increase of 1%.

Zacks Investment Research
Image Source: Zacks Investment Research

Quarter in Details

Sarepta’s commercial portfolio includes three drugs approved for treating Duchenne muscular dystrophy (“DMD”) — Exondys 51, Vyondys 53 and Amondys 45. The company’s three drugs together can treat nearly 30% of the total DMD patients in the United States. Amondys 45 was launched in the United States in February 2021

The company derived product revenues of $141.8 million, up 27.4% year over year, reflecting higher demand for Exondys 51 and Vyondys 53, and additional revenues from Amondys 45.

Sales of Exondys 51, Vyondys 53, and Amondys 45 during the second quarter were $112.5 million, $22.4 million and $6.9 million, respectively. In the first quarter of 2021, sales of Exondys 51, Vyondys 53, and Amondys 45 were $107.2 million, $17.5 million and $0.2 million, respectively. Second-quarter sales reflect sequential growth for each drug. Exondys 51 sales rose 8% year over year.

The company recorded $22.3 million in collaboration revenues, primarily from its licensing agreement with Roche (RHHBY - Free Report) for commercialization rights of its gene therapy candidate, SRP-9001 as DMD therapy in ex-U.S. markets. In the year-ago quarter, the company had recorded $26 million in collaboration revenues.

Adjusted research and development (R&D) expenses totaled $189 million in the second quarter, up 17.8% year over year. The increase was primarily due to increased clinical and manufacturing activities, especially related to its micro-dystrophin gene therapy program, and higher milestone payments made by Sarepta.

Adjusted selling, general & administrative (SG&A) expenses were $54 million, down 1.9% year over year.

2021 Guidance Raised

Sarepta raised it guidance for revenues in 2021 following strong performance of its three DMD drugs in the first half of 2021. The company now expects revenues to be in the range of $565-$575 million, indicating year-over-year growth of nearly 25% at the midpoint of the range. Previously, the company expected to the same to be between $537 million and $547 million.

Pipeline Update

In July, Sarepta successfully completed an end-of-phase-II meeting with the FDA’s Office of Tissues and Advanced Therapies (OTAT) on proposed pivotal study on SRP-9001 as well as the commercially representative material to be used in the study. The company stated on its earnings call that its commercially representative material has performed similar or better than the clinical supply material used in earlier studies. Based on the outcomes of the meeting, the company plans to start a pivotal study next month to evaluate the single administration of the candidate in DMD patients.

Along with the earnings release, the company also announced that it has executed its licensing agreement with Nationwide Children’s Hospital, gaining rights to investigational gene therapy candidate, calpain 3. The candidate is being developed for treating limb-girdle muscular dystrophy (LGMD) type 2A. The company has five other gene therapy candidates targeting LGMD in its pipeline. The lead LGMD candidate, SRP-90003, is being developed to treat LGMD type 2E. On its earnings call, Sarepta stated that the FDA along with the European regulatory authority has confirmed that the level of protein expression in patients can be a possible endpoint in a clinical study to support accelerated approval of the candidate going forward.

Sarepta Therapeutics, Inc. Price, Consensus and EPS Surprise

Sarepta Therapeutics, Inc. Price, Consensus and EPS Surprise

Sarepta Therapeutics, Inc. price-consensus-eps-surprise-chart | Sarepta Therapeutics, Inc. Quote

Zacks Rank and Stocks to Consider

Sarepta currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks from the biotech sector are Repligen Corporation (RGEN - Free Report) and Vanda Pharmaceuticals Inc. (VNDA - Free Report) , both carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Repligen’s earnings per share estimates have moved up from $2.26 to $2.69 for 2021 and from $2.56 to $2.94 for 2022 in the past 30 days. The company delivered an earnings surprise of 54.45%, on average, in the last four quarters. The stock has gained 31.9% so far this year.

Vanda’s earnings per share estimates increased from 62 cents to 67 cents for 2021 and from 80 cents to $1.01 for 2022 in the past 30 days. The company delivered an earnings surprise of 23.66%, on average, in the last four quarters. The stock has increased 21.3% so far this year.

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