Sarepta Therapeutics (SRPT 1.08%) is a mid-cap stock that has the potential to be a big player in the gene therapy market -- at least, so the business and its investors hope. It has made for a volatile investment in recent years, but with a possible game-changing treatment in its portfolio, there may be a ton of upside for Sarepta in the long run.

At the same time, however, the company continues to burn through excessive amounts of cash. Should investors take a chance on this growing biotech business, or is there too much risk here?

A big opportunity for Sarepta

The gene therapy market is growing significantly. This year, it's worth a fairly modest $8.7 billion. But it's also fast-growing, with analysts from Grand View Research projecting it to expand at a compounded annual growth rate of 19.2%; by the end of the decade, it should be worth nearly $30 billion. This highlights some great growth opportunities for Sarepta.

With over 40 programs currently in development, Sarepta is hopeful it can become a leading genetic medicine company one day. Genetic therapies can offer alternatives to patients with hard-to-treat illnesses and conditions.

One example is Duchenne muscular dystrophy (DMD), a rare genetic disorder. It affects 1 in 3,500 to 5,000 newborns (mainly boys) each year, and people with the condition don't often live past their thirties. Sarepta has multiple approved treatments for DMD, and more in clinical trials. With a high need for an effective DMD treatment, there's clearly a lot of potential for Sarepta; if one candidate succeeds, that could instantly light a fire under its valuation.

Earlier this year, the Food and Drug Administration granted accelerated approval for Elevidys. That's a potential game changer, as it's a one-time treatment for the underlying cause of DMD. But there are a few issues.

The first is that the approval was for a smaller subset of patients than the company was hoping for. Sarepta was aiming for the treatment to cover children between the ages of 4 and 7; instead, the FDA only granted accelerated approval for children who are between 4 and 5 years old. The second issue is that recent trial results were insufficient to show a statistically significant improvement when compared against a placebo. The danger is that regulators may withdraw the accelerated approval for the treatment. While the company remains optimistic that Elevidys approval can still get expanded to older children, that would appear to be a best-case scenario.

The stock comes with plenty of risks

Another risk with Sarepta is that the business remains deeply unprofitable. Over the trailing 12 months, it's incurred losses totaling $691 million. During that time, it burned through $539 million just from day-to-day operating activities. But with more than $1.7 billion in cash and short-term investments, it's not in danger of running out of money anytime soon. However, the company still needs to strengthen its financials for this to be a tenable long-term investment.

While Sarepta's business has been growing over the years, its bottom line remains deep in the red. Elevidys, with a price tag of $3.2 million, could help turn the tide and potentially give the company a path to profitability. But without a clear indication of what will happen with the treatment, it's hard to make an assessment of the company's future.

Can investing in Sarepta Therapeutics help make you a millionaire?

Over the past five years, Sarepta's stock has been a disappointment, falling by 30% in value. And while Elevidys did obtain accelerated FDA approval, investors clearly aren't optimistic about its fate given the data from its recent clinical trial. At this stage, Sarepta stock remains a high-risk, high-reward investment which may not be suitable for most investors.

Unless you have a high tolerance for risk, you're better off steering clear. While Sarepta, under the best-case scenario, could be a 30- or 40-bagger that gets a significant investment to $1 million in the long run, it also has the potential to destroy your investment. There are better and safer growth stocks to consider than Sarepta.