Sarepta quickly lays out manufacturing, launch plans after delayed approval of Duchenne MD drug

After Sarepta Therapeutics this week won an accelerated FDA approval for its controversial Duchenne muscular dystrophy (DMD) drug Exondys 51, analysts wondered how the the drugmaker would handle manufacturing to meet pent-up demand. The CEO assured them it has a plan to ramp up production, plus a way to pay for it and the commercial launch.

Initially the company will lean on contract manufacturers, but eventually it will incorporate a plant the company bought two years ago but has yet to need.

On Monday the FDA approved the drug for treatment in a small fraction of patients with DMD. Two days later, the Cambridge-based company announced that it would sell up to $225 million worth of shares. Sarepta ($SRPT) said it would use the money for a variety of business needs, like more clinical trials, as well as commercialization, business development activities and of course manufacturing.

On top of the stock offering, the company intends to sell the Rare Pediatric Disease Priority Review Voucher it was granted in the approval process to fund its various needs. Sarepta Chief Medical Officer and interim CEO Ed Kaye told FierceBiotech in an interview that “should raise a lot of capital.”

In explaining the manufacturing plans to analysts this week, Kaye said he understood there were concerns about its capacity because of delays in the approval process but that the company was “very confident” in its ability to get the product to patients, according to a Seeking Alpha transcript of the call.

“(T)here has been a great deal of effort that we put into the manufacturing,” Kaye said, explaining there was sufficient supply on hand to supply the U.S. market for more than a year.

On top of that, it is taking steps in anticipation of approvals in other parts of the world. CFO Sandy Mahatme said the company has various initiatives underway to expand capacity to supply both the U.S., as well as other markets, both clinically and commercially. Initially the it will lean on its contractors and is also looking for “backup manufacturers” which will be phased in gradually as it gets a better read in Europe.

Additionally, a spokesman confirmed that the manufacturing plan includes a plant in nearby Andover that Sarepta bought in 2014 but which, aside from some R&D work happening there, has not been pressed into service. The drugmaker at the time said it would spend about $25 million to buy and enhance the 60,000 square-foot facility, which sits on 26 acres so has plenty of room for expansion. The plant was built in 1996 and upgraded in 2006. When fully operational, the facility would have about 40 employees, it said at the time.

Approval of the drug was preceded by intense lobbying by patient groups for approval of the drug for the debilitating, life-threatening disease--for which there have been no treatment options--and immediately after by an intense FDA staff debate about whether the drug showed enough benefit to be worthy of approval. Kaye called the FDA’s decision “courageous.”

As for the commercial side of the equation, Kaye acknowledged to FierceBiotech that it is unusual for a company of Sarepta’s size, about 200 employees, not to have a partner to help roll out the launch. But he said “we have all of the resources that we need to launch this drug in the U.S. and Europe, without needing anyone else. ... I think, given that it takes a fairly small commercial group to be able to do this, there’s no reason why a company our size can’t do it. We have plans to really build a commercial presence in Europe, and we’re starting that right now.”

Kaye indicated the drugmaker was planning to file with the European Medicines Agency at the end of the year and is already in talks with England’s drug price watchdog, NICE, talks the regulator instigated itself.

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