Sarepta Therapeutics had a successful 2024, achieving strong financial results and anticipating further growth.
From Nasdaq: 2025-02-26 23:00:22
Sarepta Therapeutics reported strong financial results for the fourth quarter and full year 2024. The company achieved over $1.8 billion in net product revenue, with a 56% year-over-year growth. Their gene therapy, ELEVIDYS, had a successful launch, with sales of $384 million in the fourth quarter alone. Sarepta’s strategic plan, Project Moonshot, has been a success, leading to multiple potential blockbuster siRNA launches in the future. The company is on track to achieve over $16 billion in operating income and over $13 billion in free cash flow by the end of 2030. In the fourth quarter, our three PMOs achieved $254 million in revenue, with a total of $967 million for the full year. We were profitable both on a GAAP and non-GAAP basis, and cash flow positive. Looking ahead to 2025, we aim to capitalize on the successes of 2024, with projected net product revenue guidance of $2.9 billion to $3.1 billion. Our R&D and tech ops are progressing well, with upcoming milestones for our LGMD platform. We have also closed a transaction with Arrowhead and have significant milestones planned for 2025, including readouts for ARO-DUX4 and ARO-DM1. Our goal is to become a globally relevant biotech focused on rare diseases. Sarepta Therapeutics has treated approximately 5% of the on-label addressable patient population for ELEVIDYS, with positive findings from the Part 2 of the EMBARK study adding to the clinical evidence. The company remains confident in patient demand, site capacity, access, and conversion rates for the gene therapy. They project strong revenue growth and expect to outperform other gene therapies in the first 30 months of the launch.
In a recent meeting, Sarepta discussed the importance of understanding the patient dosing conversion timeline and their successful execution over six quarters since the launch. The company’s revenue guidance for 2025 shows strong growth projections and confidence in their ability to deliver quarter over quarter. Positive follow-up data from the EMBARK study for ELEVIDYS demonstrates the therapy’s impact on Duchenne patients’ muscle health and function, with promising results in maintaining muscle integrity. In terms of clinical trials, Sarepta announced the positive results of ELEVIDYS studies supporting the durability of the therapy. They are progressing well with the ENVISION study for Duchenne patients and have commenced studies for patients with preexisting anti-AAVrh74 antibodies. Additionally, they completed enrollment and dosing of EMERGENE for LGMD Type 2E and are on track for BLA submission in the second half of 2025. Sarepta also highlighted upcoming programs for LGMD2D and LGMD2C, as well as their pipeline for various indications and innovative research in genetic medicine.
Furthermore, Sarepta discussed their programs for FSHD1 and DM1, with encouraging nonclinical data for SRP-1001 and potential benefits for DM1 patients with SRP-1003. They are optimistic about data readouts later this year. The ESSENCE and MISSION trials for golodirsen, casimersen, and EXONDYS are fully enrolled and progressing well. Sarepta expressed gratitude to the patient community, investigators, and employees, highlighting Rare Disease Day and the importance of bringing new treatments for rare diseases. Finally, the financial results for the fourth quarter of 2024 showed total revenues of $658.4 million, reflecting significant growth compared to the same period in 2023. In the fourth quarter of 2024, ELEVIDYS saw a significant increase in net product revenue, reaching $384.2 million compared to $131.2 million in 2023. This growth was driven by sales of ELEVIDYS. Additionally, collaboration and other revenues totaled $20.3 million for the quarter. Despite an increase in R&D and SG&A expenses, the company reported a non-GAAP net income of $206 million, up from $86.6 million in 2023. Looking ahead, the company is maintaining its 2025 total product revenue guidance and anticipates combined non-GAAP R&D and SG&A expenses of $1.2 billion to $1.3 billion for the year. With a strong financial position and positive business outlook, the company is well-positioned to achieve its 2030 strategic goals. Sarepta Therapeutics is on track to achieve $3 billion in total revenue this year, with two-thirds coming from ELEVIDYS and the rest from three PMOs. Limb-girdle Type 2E is an ultra-rare disease with an even split between ambulatory and non-ambulatory patients. The company is preparing to share safety and efficacy data for FSHD and DM1 later this year, focusing on single ascending dose studies. The upcoming data for limb-girdle Type 2E is expected to show good expression and safety, building on the company’s previous successes with SRP-9003 and ELEVIDYS. In a recent update, the company discussed progress in their limb-girdle programs, emphasizing the importance of biomarkers for functional improvements. They will be sharing five-year safety follow-up data for patients in their first study, with promising results for future studies using the same platform. Questions were raised about the upcoming data for DM1 and FSHD programs, with a focus on safety, muscle concentration, and knockdown of specific genes. The company remains cautious in interpreting early data but sees potential for future product profiles.
Regarding ELEVIDYS, the company noted early signs of success in reimbursement for patients previously on PMOs. While it’s still early days, the company has seen instances of reimbursement for both ELEVIDYS and PMOs, with limited net cannibalization observed. The company is encouraged by payer interest in sequential therapy post gene therapy. They remain cautious about drawing broad conclusions at this stage. Douglas Ingram and Ian Estepan from PTC Therapeutics discussed their plans for capital deployment after completing the Arrowhead transaction. They aim to build cash reserves over the next 18 months and potentially buy back shares. The company’s ELEVIDYS launch showed significant growth, with expectations of over 160% growth in 2025. PTC is also exploring suspension manufacturing for gene therapy programs to increase yield efficiencies and bring therapy to more patients globally. The company aims to start a bridging study before the end of the year for this initiative. Sarepta Therapeutics is planning to conduct a bridging study later this year to confirm the safety and expression of their therapy for facioscapulohumeral muscular dystrophy (FSHD). The company is exploring biomarkers and functional outcomes in Phase 1 studies to optimize their path forward. They are also engaging in discussions with the FDA and other stakeholders to inform their approval pathway. Regarding the commercialization of their ELEVIDYS therapy, Sarepta acknowledges the complex process involving multiple steps, including insurance authorization, center capacity, and payer negotiations. The company is confident in their understanding of the process and is seeing positive engagement from payers. Despite varying payer restrictions, Sarepta is successful in getting kids on therapy, with a 90% win rate in appeals for resistant payers and 100% success with ELEVIDYS. The process takes about four months, with a focus on time and attention to detail. With robust patient demand and positive trends in access, Sarepta is on track for significant growth in 2025, including $3 billion in revenue and 160% growth for ELEVIDYS. Despite competition, Sarepta remains confident in the transformative nature of ELEVIDYS for Duchenne muscular dystrophy patients, emphasizing the importance of accurate information for families making treatment decisions. Sarepta Therapeutics discussed the importance of functional outcomes in gene therapy development for Duchenne muscular dystrophy. Quality and functionality of constructs are crucial for patient benefit. The company has shown consistent expression leading to functional improvement in clinical studies. Sarepta remains confident in approval based on vector genome copies and expression levels seen in previous programs. Competition modeling for DMD gene therapies is premature given early stages of development. R&D Day in the second half of the year may present new data, potentially including Arrowhead collaboration results. EMERGENE trial enrolls both ambulatory and non-ambulatory patients, with data comparison to natural history cohort anticipated. Arrowhead Pharmaceuticals is conducting the EMERGENE study to analyze the expression levels of ELEVIDYS in both ambulatory and non-ambulatory patients. The company plans to compare the results with their JOURNEY natural history study. The goal is to confirm the efficacy of ELEVIDYS across different disease stages.
The consensus estimate for U.S. ELEVIDYS sales in 2033 is $2.2 billion, with approximately 850-900 treated patients annually. Arrowhead expects the incident population in the U.S. to be around 420-430 patients, with additional revenue from PMOs. The company aims to resolve redosing issues by the 2030s to sustain growth.
Arrowhead Pharmaceuticals is planning to launch three limb-girdle programs annually for the next few years, including FSHD in 2028 and DM1 in 2029. These programs present multibillion-dollar sales opportunities, contributing to the company’s terminal value.
As ELEVIDYS becomes a larger part of Arrowhead’s revenue, the company anticipates an evolution in gross margins by 2025-2026. They expect margins to improve over time, reaching the high 70s and potentially trending towards 90%. Arrowhead has developed a new DUX4 assay to measure low levels of DUX4 expression, enhancing their research capabilities.
Arrowhead Pharmaceuticals has not experienced any permanent denials of therapy for patients seeking ELEVIDYS treatment. The company’s PMOs have shown a response rate above 90% in the past, with ELEVIDYS demonstrating even better results. Arrowhead remains confident in the positive outcomes of their therapy and continues to work towards improving patient access and outcomes. During a pre-BLA meeting with the FDA, a positive endorsement was given for Sarepta’s limb-girdle program, including the use of beta-sarcoglycan as a biomarker. Encouraging interactions with the agency suggest a promising future for the platform. CEO Douglas Ingram praised the work done to modernize approaches to ultra-rare diseases. Arrowhead’s differentiation in RNA approaches for DM1 and FSHD lies in their comprehensive focus on construct design and targeting ligands. The team’s expertise in managing ELEVIDYS cadence contributes to a successful launch. Sarepta looks forward to achieving milestones in 2025. Sarepta Therapeutics provided updates on their limb-girdle, FSHD, and DM1 data during a recent conference call. The company’s executives shared progress and plans for the future. Various analysts participated in the call, discussing the company’s performance and potential. The transcript was produced by The Motley Fool, with a disclaimer about potential errors or inaccuracies. The Motley Fool does not endorse any specific stocks mentioned in the article. This information is for informational purposes only, and readers are encouraged to conduct their own research. Nasdaq, Inc. does not necessarily endorse the author’s views.
Read more at Nasdaq: Sarepta Therapeutics (SRPT) Q4 2024 Earnings Call Transcript