The markets weren't quite sure what to think of the future of Sarepta Therapeutics (NASDAQ:SRPT) after Prosensa (NASDAQ: RNA) and GlaxoSmithKline's (NYSE:GSK) drug drisapersen failed to meet phase 3 clinical trial endpoints in the treatment of Duchenne muscular dystrophy, or DMD.

Prosensa shares collapsed dramatically 70% with ease by end of trading on the day of the news. Sarpeta boomed early pre-market, swung wildly downward as much as 10% before the opening bell, waffled with marginal gains in the morning, and finally roared to an 18% gain by the afternoon as the market wrestled with what this meant for eteplirsen.

Available details of the phase 3 trials are slowly becoming available, but despite tepid cheerleading from researchers at both Prosensa and Glaxo, drisapersen is likely out of the DMD race barring some great undisclosed news. As the dust settles, this development does little to change the regulatory equation for Sarepta and provides a minor benefit to eteplirsen market viability.

They all stand alone
It may seem like a big deal that drisapersen failed with such gusto. Both drugs are from a novel class of exon-skipping agents and are often compared to one another as potential blockbusters.

However, the results late last week do not provide much data to suggest anything other than problems with drisapersen alone.

Among the constellation of currently approved drugs, there are commonly wide differences in efficacy between agents of the same therapeutic class. Moreover, there are countless, successful therapies whose histories are littered with forgotten cousins that failed to get past clinical trials.

Without data to suggest that all exon-skipping drugs fail to produce an effect, the drisaspersen study results don't mean much. Eteplirsen will continue to survive on its own merit.

The outlook would be far bleak for Sarepta if drisapersen had failed due to unexpected safety concerns. An arguably worse case would have occurred if Friday's dismal verdict had reversed preliminary drisapersen results more in line with far more impressive early eteplirsen results.

Under these hypothetical scenarios, there would be a much stronger case for the FDA to search for a potential issue among the exon-skipping family instead of drisapersen as a lone, bad apple.

The little trial that could
While it's nearly certain that the FDA will take a closer look at exon-skipping agents, let's remember a few things about DMD and eteplirsen. Most importantly, DMD patients absolutely do not get better on their own and the small 12-patient eteplirsen study produced otherwise impossible results. 

The phase 3 drisapersen trial included 186 patients -- enough statistical power to show that the mild improvements previously observed were merely red herrings. However, there is no magic number for a proper sample size when a statistical analysis is performed correctly.

Statistical significance is the product of both sample size and effect size. That just means when an effect is small compared to baseline, a large sample size is needed to show statistical significance. On the flip side, a huge effect occurring within a small sample size can still achieve statistical significance even if the sample size is tiny.

Baseline prognosis for most DMD patients is a short life complicated by years of cardiac and respiratory supportive care. The details of last year's eteplirsen trial results are well known and better discussed elsewhere, but there is little doubt that they were impressive and at times even phenomenal. The question that the FDA will weigh going forward is whether the results were phenomenal enough to warrant an easier road to market. Drisapersen's failure changes the question very little.

The race: Sarepta and the other guys?
The field of eteplirsen competitors has always been fairly lackluster. However, their continued efforts, especially in tandem with big players like Glaxo, did have a chilling effect on investor confidence in Sarepta. With Prosensa on the ropes, the outlook only looks better for Sarepta going forward.

Until a more compelling clinical case can be made for another drug, this is a pattern that will likely repeat itself as mediocre results continue to pile up among the opposition.

The FDA can still potentially call on Sarepta to produce additional data. This remains unlikely as eteplirsen fits the mold of the ideal fast-track approval drug fairly well. However, even if eteplirsen is asked to undergo further study, the impact of recent events will have been minimal in that decision.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.