Solid Biosciences (SLDB) Hit By Clinical Hold On Lead Drug

Shares of Solid Biosciences Inc. (NASDAQ:SLDB) tanked 54.2% after the FDA notified the company that its phase I/II trial, IGNITE DMD, on lead candidate SGT-001 has been put on clinical hold.

Solid Biosciences’ stock has gained 16.3% in the last three months, outperforming the industry’s rally of 2.2%.

Solid Biosciences’ lead candidate, SGT-001, is a novel adeno-associated viral (AAV) vector-mediated gene transfer which is being evaluated for the underlying genetic cause of Duchenne muscular dystrophy (DMD) mutations in the dystrophin gene that result in the absence or near-absence of dystrophin protein.

The phase III study is designed to assess the safety and efficacy of SGT-001 in ambulatory and non-ambulatory children, and adolescents with DMD.

The first patient dosed in the clinical trial was a non-ambulatory adolescent who received 5E13 vg/kg of SGT-001 on Feb 14, 2018. The event was classified as a Suspected Unexpected Serious Adverse Reaction (SUSAR). The patient was hospitalized due to laboratory findings which included a decrease in platelet count, followed by a reduction in red blood cell count and evidence of complement activation.

The clinical hold was placed due to the above-mentioned event. Consequently, Solid Biosciences has halted enrolled and dosing in the phase III study. The company is awaiting a formal clinical hold letter from the FDA.

The company will work closely with the agency to resolve this issue.

We note that SGT-001 has been granted Rare Pediatric Disease Designation, or RPDD, in the United States, and Orphan Drug Designations in both the United States and the European Union.

The clinical hold comes as a major setback for the company since SGT-001 is its lead candidate.

Meanwhile, another company with a presence in the DMD market, Sarepta (NASDAQ:SRPT) announced that it will seek rapid approval for its second drug — golodirsen — to treat DMD. Sarepta had met the FDA Division of Neurology Products in February 2018 to obtain guidance on the regulatory pathway for golodirsen. Sarepta will file a rolling new drug application (NDA) with the FDA, seeking accelerated approval of golodirsen for DMD in patients who have a confirmed mutation of the DMD gene susceptible to exon 53 skipping. Sarepta intends to complete a rolling NDA submission for golodirsen by year-end 2018. Sarepta’s only approved drug — Exondys 51 — is approved in the United States as a once-weekly intravenous infusion, specifically targeting patients who have a confirmed mutation of the DMD gene susceptible to exon 51 skipping.

Zacks Rank & Key Picks

Solid Biosciences carries a Zacks Rank #3 (Hold). Investors interested in the health care space can consider some better-ranked stocks such as Regeneron Pharmaceuticals (NASDAQ:REGN) and Ligand Pharmaceuticals (NASDAQ:LGND) . While Regeneron sports a Zacks Rank #1 (Strong Buy), Ligand carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Regeneron’s earnings per share estimates have moved up from $18.65 to $18.68 for 2018 in the last 30 days. The company pulled off a positive earnings surprise in three of the last four quarters, with an average beat of 9.15%.

Ligand’s earnings per share estimates have moved up to $4.20 to $3.78 from $4.75 to $5.32 for 2018 and 2019 respectively over the last 30 days. The company delivered positive earnings surprises in three of the trailing four quarters, with an average beat of 24.88%.

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