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Editor's note: A previous version of this article erroneously referred to Sarepta and Tekmira's drugs as vaccines, and mentioned that MAP Pharmaceuticals was developing an Ebola therapy. The Fool regrets the errors.
On Tuesday, Sarepta Therapeutics (Nasdaq: SRPT ) announced that the Food and Drug Administration had approved fast-track status for the company's Ebola and Marburg drugs. The two are Sarepta's leading infectious disease drug candidates, so this would seem to be good news for the company. As always, though, the devil is in the details, so let's look a little more closely at this story.
Public health officials frequently describe Ebola as the most frightening disease of our time. It kills 90% of infected people, and a large proportion of those tend to be health care workers who are exposed to it when trying to help others. It is an excruciating way to die. To date, no one really knows the origins of the disease, nor how it first appears in previously unexposed regions.
Marburg is a cousin virus to Ebola and has similar characteristics in all the respects I cover in this article, except that Ebola is the more deadly of the two. I will therefore confine my discussion to Ebola, but the dynamics are essentially the same for both diseases.
Just as medical workers finally succeeded in containing a deadly outbreak in Uganda, a new outbreak recently appeared 500 miles away in the Democratic Republic of Congo. Did the virus travel between the two sites? If so, how? No one knows, but it certainly raises the specter of a leap to other continents. What if Ebola stowed away on a plane bound for the U.S.? While the likelihood of such a jump is low, it remains a concern for experts.
There is precedent for this in non-human primates. In 1989, a shipment of monkeys destined for lab testing at a Covance (NYSE: CVD ) (then known as Hazleton) facility in Reston, Va., turned out to be infected with Ebola, setting off a panic among public health officials. The outbreak was contained and never jumped to humans, but it remains a cautionary tale.
Perhaps a greater worry, though, is Ebola's potential for use as a weapon. The U.S. Department of Defense and the National Institutes of Health certainly seem to perceive this threat: They funded millions of dollars of Sarepta's research. So why on Earth did they issue a stop-work order on this research in August, and what implications might that have for Sarepta?
The DoD has been extraordinarily tight-lipped about its suspension of funding for this research. A defense department spokeswoman said it would "evaluate each contractor's efforts independently to determine the plan for moving forward with the development of the best drug candidate possible." This may be a good time to mention that Sarepta is not the only game in town.
Tekmira Pharmaceuticals is also working on a drug. Both were receiving DoD funding, and both had begun clinical trials.
There are some other pursuits to find a treatment for Ebola. Mapp Biopharmaceutical is hard at work on an Ebola therapy, and -- until the stop-work order -- was also receiving funding from the DoD. Novartis (NYSE: NVS ) has found that two of its leukemia drugs are effective in killing the Ebola virus in a laboratory environment, but much more work will be required to determine if this can evolve into a viable treatment.
It might seem that a vaccine and a treatment would be complementary, but they could actually be competitors in this landscape. Consider the signals: The DoD is the primary research-funding source, and big pharma has to date shown no interest. The DoD spokeswoman's statement would seem to indicate that the DoD is now looking to limit funding to the most promising candidate(s).
On the question of prevention versus treatment, we should consider the disease mechanics, as they are currently understood. Several small companies are making progress on developing a treatment for Ebola. The problem is that the most promising treatments in the pipeline would need to be administered within 24 to 48 hours of exposure, which is well before symptoms appear. Current diagnostic tests, such as those produced by Merck KGaA's (OTC: MKGAY) EMD Millipore unit, are not readily available in the regions where Ebola currently exists. So by the time anybody realizes that there's an outbreak, it would be too late.
A vaccine, then, would appear to be the more promising route at this point, but whom do we inoculate? We still don't know how the disease spreads in the first place. It would be enormously expensive to launch a universal vaccination program, and because the disease incidence is still so limited, it seems unlikely that money would appear for this. At the very least, though, a vaccine could confer extraordinary benefit to health care workers in the regions of the world where the disease appears. My money is, therefore, on the vaccine.
If the DoD is trying to pick a winner, the FDA may have just done it for them. The fast-track approval is a vote of confidence in Sarepta's approach, and will provide the company an advantage going forward. It's a gamble, but I think Sarepta is going to come out ahead here.
Foolish bottom line
There are no guarantees in the world of biotechnology and pharmaceutical development. Still, my bet is that all things considered, the future looks bright for Sarepta's drug and for the poor souls out there who haven't been infected with Ebola -- yet. Of course, when looking at Sarepta as a stock, potential investors need to understand that most of the optimism around the company relates to its treatment for Duchenne muscular dystrophy, a topic that Fool contributor Keith Speights dove into earlier this month.
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