Just a few weeks after Solid Biosciences $SLDB put out an 11th hour notice that its gene therapy for Duchenne muscular dystrophy had been put on a partial clinical hold due to safety concerns, just ahead of its $125 million IPO, the biotech is back Wednesday evening with the news that the agency has now halted the study in the wake of an adverse reaction to the therapy by the first patient in the trial.
The stock plunged 54% after the news hit, signifying that this time around investors aren’t quite so sanguine about safety issues. But the pain didn’t end there. JPMorgan, which helped on the IPO, turned bearish on the news and cautioned on the company’s prospects in the wake of a safety issue that raised serious doubts about Solid’s executive team. By mid-afternoon on Thursday, the stock was down 63%, shearing off more than $600 million in value.
“In our view, it will likely take compelling clinical data to regain confidence in management (not expected in the near-term),” said JP Morgan’s Anupam Rama, according to a Bloomberg report. Rama set the new price at $9, a sickening drop from the $16 price they launched at.
This is from Solid’s statement:
The first patient dosed in the clinical trial was a non-ambulatory adolescent who received 5E13 vg/kg of SGT-001 on February 14, 2018. Several days after administration the patient was hospitalized due to laboratory findings that included a decrease in platelet count followed by a reduction in red blood cell count and evidence of complement activation. The patient showed no signs or symptoms of coagulopathy (bleeding disorder) and no relevant changes from baseline in liver function tests. The patient responded well to medical treatment and is currently asymptomatic. All laboratory parameters have either improved or returned to normal, and he is continuing outpatient assessments per protocol.
The FDA is likely on high alert on Solid after James Wilson, a pioneer in gene therapy who developed the AAV delivery tech that Solid is using, resigned from the advisory board after an animal study raised a red flag about potential safety issues when used at a high dose. Wilson was alarmed after a monkey was killed by liver toxicity after being exposed to a high dose AAV treatment, with evidence of motor neuron damage in piglets. A number of companies use AAV tech in-licensed for their work. But none of the others has been hit with a hold.
Solid CEO Ilan Ganot — a former JP Morgan investment banker — has made much of the fact that he’s a Duchenne MD dad out to find a gene therapy that could cure the lethal, rare disease. By introducing a synthetic dystrophin transgene construct, called microdystrophin, via a viral vector, the company hopes to prove it can do what Sarepta and others have been groping for with one decisive intervention. And he had attracted some heavyweight backers, including RA Capital and their colleagues at Bain.
Some analysts supporting Sarepta $SRPT in the race to develop a gene therapy for DMD are likely to gleefully suggest that Solid’s troubles are Sarepta’s boon. Sarepta has dosed a couple of patients now, looking for a one-time therapy to help save boys from a devastating illness.
Ganot’s decision to keep the partial hold out of the news while it was doing a road show on the IPO raises questions about the level of transparency – or lack it – that allows private drug developers to operate in secrecy. Aside from notifying researchers, regulators and patients, a private developer is not required to air safety issues. The FDA certainly won’t say anything. And we saw the exact same thing play out recently when Unum filed their IPO, revealing two patient deaths months earlier and a clinical hold on the high dose of their lead cell therapy, which they subsequently dumped.
The Cambridge, MA-based biotech says it’s working with the FDA on getting the hold lifted.
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