Sarepta shares yo-yo in the red on another glimpse of stellar results for Duchenne MD gene therapy — what gives?

There’s just no telling what a stock will do — even when you stack the deck in your favor.

Tonight Sarepta $SRPT came out with a GREAT piece of news. Adding to the stellar, but very early glimpse of positive data for their gene therapy for Duchenne muscular dystrophy, the biotech updated their data with a set of new numbers that would appear to add to the overall glow of the program.

And then its stock took a dive, falling close to 10% in a matter of minutes after the delayed release hit the wires. Then it bounced back, only a few points in the red. What gives?

Is this sell the news? And why would that be? Shorts covering their positions? Several insta-reactions in the Twitterverse suspected that the fourth patient did too well, seeing a 182% increase in dystrophin, the much-wanted element that creates havoc for patients, whose muscles waste and die without it.

As measured by Western blot, patient 4 showed robust levels of micro-dystrophin, with a mean of 182.7% compared to normal utilizing Sarepta’s method, or 222% compared to normal pursuant to Nationwide Children’s quantification of Sarepta’s method that adjusts for fat and fibrotic tissue.

Was that too much? Or too variable?

Baird’s Brian Skorney, a strong Sarepta bull, heard the disturbance in the force, but isn’t about to crumble now.

We expect to debate concerns over noisy CK data and implications of overexpression but see these as very minor points on an otherwise very impressive data set and reiterate our Outperform.

I asked Skorney — one of the more thoughtful analysts in the bunch — about the red numbers. His reply:

I think the initial negative reaction is due to the high expression levels that are reminiscent of the concerns around variability with BioMarin’s Factor VIII program and some rebound in CK levels in the first three patients. I don’t really expect any afterhours down move to be sustained tomorrow though.

Several analysts and reporters helpfully provided the embargoed thumbs up, with quotes. Yet there, but for the grace of the biotech Gods, go I. I was tipped to the release… but never actually got it as offered.

Again, another mystery for those of us who cover the field.

On the face of it, Sarepta would seem to have everything going in its favor. The gene therapy is providing the necessary evidence of a solid biomarker response. Even some signs in the single arm study — without the comparison data that would help prove that it makes a difference  — that it’s helping patients improve physically.

And this is a terrible disease. An actual cure would be a godsend.

Sarepta has an unfortunate history when it comes to historical comparisons, though, which raised significant doubts in the agency that eteplirsen works.

Anyway, before the post-market trading closed Wednesday evening, the stock had edged back into the green, so the defenders of the faith had held the line, briefly. By mid-morning Thursday, the stock was back in the red again.

I’ll wait for some additional commentary. In the meantime, caveat emptor.

You’re on your own, as always.

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Research Scientist - Immunology
Recursion Pharmaceuticals Salt Lake City, UT
Director of Operations
Atlas Venture Cambridge, MA

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