Sarepta's stock fell 20% after patient death

Sarepta Therapeutics, a biotech company that focuses on gene therapies, has faced significant challenges. Recently, its stock dropped by 20% in one day after an update on its key product, Elevidys. This decline adds to an ongoing struggle, as the company's performance has not been strong over the past six months. Elevidys is a gene therapy designed to treat Duchenne muscular dystrophy (DMD), a serious genetic disorder that weakens muscles. Last year, it received full approval for use in patients aged 4 and older who can walk. However, it is still under accelerated approval for non-ambulatory patients, which requires additional trials to prove its effectiveness. The current problem stems from the death of a young patient treated with Elevidys, who suffered acute liver failure. Although liver issues are known risks, this death is concerning for the company and could impact future sales of Elevidys. The situation has alarmed investors, as the drug accounts for a significant portion of Sarepta's revenue. In the fourth quarter, Sarepta reported revenue of $658.4 million, with Elevidys generating $384.2 million. Despite the recent tragedy, the company mentioned the patient suffered from a virus that might have contributed to the liver failure, raising questions about the relationship between the drug and the death. Investors are now weighing their options. Sarepta could rebound if doctors and patients continue to prescribe Elevidys, as it fulfills an important medical need. However, the uncertainty around its future, including potential regulatory challenges, adds risk. Some investors may consider buying the stock at its lower price, while others might look for safer opportunities in the biotech sector.