What happened

Shares of Sarepta Therapeutics Inc. (SRPT -4.89%), a biopharma company in the middle of its first drug launch, rose 22.5% in April according to data from S&P Global Market Intelligence. Stronger-than-expected sales of its Duchenne muscular dystrophy (DMD) drug Exondys 51 and buyout rumors lifted the stock last month.

So what 

Sarepta Therapeutics has been full of surprises lately. Last September, the Food and Drug Administration (FDA) granted Exondys 51 a highly controversial approval despite lacking direct evidence of its ability to slow progression of the muscle-wasting disease. Despite the regulatory green light, most analysts expected end payers to push back when asked to shell out around $300,000 annually for the unproven therapy.

Finger drawing an upward sloping chart.

Image source: Getty Images.

Sarepta gave its investors a pleasant surprise in April when it announced $16.3 million in first-quarter Exondys 51 sales. That's a threefold increase over the previous quarter, which suggests insurance reimbursement denials aren't going to be as severe as feared.

The company's CEO Ed Kaye delivered another surprise last month by announcing his imminent departure. Sarepta's corresponding SEC filing states his resignation was planned, but the announcement still stoked buyout rumors.

Now what

Although you shouldn't put much faith in buyout rumors, it's interesting to note that a Sanofi executive also stepped down from his position on Sarepta's board of directors due to a possible conflict of interest. In recent years, the big French pharma failed to bag a couple of big, high-profile acquisitions, and has since turned its attention to smaller biotechs. 

While a buyout offer may loom on the horizon, investors will want to remain focused on Exondys 51's launch. Sarepta raised its expectations for the year from $80 million stated previously to $95 million when it reported first-quarter earnings. With Sarepta's recent market cap of about 1.8 billion, continued success for the therapy is already baked into the stock. Any hints the launch might not continue along its current trajectory will almost certainly lead to heavy losses from present levels.