Capricor shares double as FDA agrees to review Duchenne drug data

Capricor Therapeutics shares more than doubled in premarket trading after the FDA agreed to review new data on its Duchenne muscular dystrophy drug deramiocel.

"The Advisory Committee outcome was not the one we hoped for," Linda Marbán, chief executive officer of Capricor, said. "The full dataset has since been published in The Lancet following extensive and independent peer review, and we continue to believe there is a path to approval for Deramiocel."

The stock traded at $9.02 in premarket, up 114 percent from Thursday's close of $4.21, giving the San Diego-based company a market value of about $243 million. The FDA's willingness to review the new data comes ahead of an August 22 PDUFA target action date for deramiocel, an allogeneic cell therapy that Capricor now seeks to approve for upper-limb skeletal muscle function in DMD rather than the cardiomyopathy indication it originally requested.

The company's HOPE-3 Phase 3 trial, which enrolled 106 patients, met its primary endpoint, slowing upper limb function decline by 54 percent versus placebo (PUL 2.0, p=0.03). But the FDA's advisory committee voted 9-3 on July 29 that the evidence did not support deramiocel's efficacy for DMD-associated cardiomyopathy, after regulators criticized post-trial changes to the statistical analysis plan. The stock fell 64 percent to $7.00 on July 27 and another 36 percent to $4.19 on July 30.

Deramiocel consists of allogeneic cardiosphere-derived cells that secrete exosomes, which target macrophages to adopt a healing rather than pro-inflammatory phenotype. The therapy holds Orphan Drug, Regenerative Medicine Advanced Therapy, and Rare Pediatric Disease designations from the FDA, the last of which could qualify Capricor for a Priority Review Voucher on approval. DMD affects roughly 15,000 people in the United States, primarily boys, with cardiomyopathy the leading cause of death.

The regulatory reversal marks a sharp swing for a company that held about $237.9 million in cash as of June 30 and posted a second-quarter net loss of $40.7 million, or $0.70 a share. The consensus analyst price target fell to about $4.38 from $49.44 after the advisory committee vote, according to Simply Wall St data, and Capricor is fighting a legal dispute with Nippon Shinyaku's NS Pharma unit over a distribution agreement while facing a securities class action over its disclosure of the statistical plan changes.

The FDA's decision to review the new data gives deramiocel a second chance at approval after the advisory committee setback, but the August 22 PDUFA date remains the decisive event. Investors will watch whether the agency accepts the upper-limb indication and how the NS Pharma dispute and litigation shape the company's path to commercialization.

This article is for informational purposes only and does not constitute investment advice.