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Citi started coverage of Sarepta Therapeutics (NASDAQ:SRPT) with a buy rating, stating that it likes the risk/reward heading into the FDA’s review of the company’s drug Elevidys for full approval for the treatment of Duchenne muscular dystrophy.
Citi sees the FDA as still willing to convert the product’s accelerated approval into full approval and expanding the label to all ambulatory patients, with 35% to 45% upside for the stock versus a 15% to 20% downside if it is rejected.
“In our view, the current share price reflects concern on bearish scenarios, including Elevidys being pulled from the market, that are unlikely to materialize,” the bank said. Cit added that it has modeled US peak sales for the drug at $2.2B with 90% probability of success for Elevidys.
Citi set its price target for the stock at $113.
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