Sarepta Therapeutics Inc (SRPT): Is The DMD Market Becoming Too Crowded?

Today, Dendreon Corporation (NASDAQ:DNDN) faces competition from Johnson & Johnson’s Zytiga, Medivation’s Xtandi, and then a long list of other companies in clinical development such as Celgene, Immunomedics, Threshold Pharmaceuticals, and NewLink Genetics.

This reality has led to Dendreon Corporation (NASDAQ:DNDN) producing sales of just $311 million over the last 12 months, including a 17.6% year-over-year loss during its last quarter. Now, with prostate cancer being a much larger indication, the question becomes whether or not this will happen with DMD?

Personally, I don’t think DMD has reached that point of congestion, and it is still too early to know which products will emerge in the market. However, it is definitely an area of concern to monitor.

Conclusion

I am focused on Sarepta Therapeutics Inc (NASDAQ:SRPT) in this DMD discussion because it is the company that has captured the imagination and the wallets of Wall Street, and has the most to lose with the success of competitors.

PTC has the most to gain with the smallest market capitalization and the lowest expectations, but if proven successful, Sarepta and GlaxoSmithKline plc (ADR) (NYSE:GSK) could take their exon-skipping technology to develop countless other therapeutics.

Obviously, GlaxoSmithKline plc (ADR) (NYSE:GSK) does not rely solely on this one product, but Sarepta Therapeutics Inc (NASDAQ:SRPT)’ valuation is largely tied to eteplirsen. Unlike Dendreon Corporation (NASDAQ:DNDN), the company is not relying on this sole product. The company is developing a number of exon skipping products; a total of nine programs in development.

The company has produced its current study results with eteplirsen by just focusing on the exon 51, but also has programs that skip exons 45, 50, and 53. In a study on the Marburg hemorrhagic fever virus, 83% of patients survived after 40 days with this deadly virus.

Hence, the long-term upside for Sarepta looks solid, with a strong pipeline, but in a congested market, short-term loss and below consensus sales should be expected.

The article Is The DMD Market Becoming Too Crowded? originally appeared on Fool.com and is written by Sherrie Stone.

Sherrie Stone has no position in any stocks mentioned. The Motley Fool owns shares of Dendreon. Sherrie is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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