Shares of the clinical-state biotech Sarepta Therapeutics (NASDAQ:SRPT) have certainly been on a wild ride over the past year. And the underlying cause of this volatility has undoubtedly been the regulatory and clinical uncertainty regarding the company's Duchenne muscular dystrophy, or DMD, drug eteplirsen.

Duchenne muscular dystrophy stems from a lack of dystrophin production, leading to muscle weakness and eventually, cardiorespiratory failure in the mid-teens to early 20s. Eteplirsen aims to treat a specific form of the disease by skipping exon-51 to partially restore dystrophin production. Moreover, Sarepta's broader goal is to be able to treat over half of DMD sub-types using its morpholino-mediated exon-skipping technology. And achieving that goal begins with validating this platform with eteplirsen, the company's most advanced clinical candidate. 

SRPT Chart

SRPT data. Source: YCharts.

Despite eteplirsen showing significantly increased dystrophin production in a small cohort of boys ages 7 to 13, the Food and Drug Administration previously declined to review an accelerated application for the drug because of the study was limited to only 12 boys. By comparison, GlaxoSmithKline (NYSE:GSK) and Prosensa's (UNKNOWN:RNA.DL) competing exon-skipping drug drisapersen included over 50 boys in its mid-stage trial. And as the story goes, that drug went on to fail in late-stage testing despite showing promising efficacy signals at the mid-stage level. Regarding the small sample size, the problem was that Sarepta simply did not have the capacity to manufacture the drug on a scale to support a larger study at the time. 

Sarepta and patient advocate groups alike have nonetheless extensively lobbied the FDA to reconsider its position, which it apparently has, giving the company a path forward for a potential accelerated approval last month. On Sarepta's first-quarter earnings call, we learned a number of new details about the FDA's thinking regarding eteplirsen, as well as Sarepta's plans moving forward. So, here are some key takeaways from their recent corporate and clinical update. 

Clinical and regulatory updates
One of the first things we learned is that the FDA is willing to review eteplirsen on an accelerated basis but they will require additional safety data. These data can come from the ongoing extension studies, but the FDA also wants Sarepta to begin enrolling patients in additional trials.

Specifically, the FDA wants Sarepta to perform at least one more study and preferably two studies, with one being a historically controlled study and the other being a placebo-controlled study with the six-minute walk test as a primary endpoint. The primary endpoint of the historically controlled study appears to be still under debate between Sarepta and the FDA. As we've known for awhile, Sarepta wants to use dystrophin production as a primary endpoint, whereas the FDA presumably prefers the walking test. Digging into the call a bit deeper, we learned that Sarepta is hoping to convince the FDA that the historically controlled study can use dystrophin production as a primary endpoint, validated by an ongoing expert review of the issue.

Finally, we now know that the FDA wants these studies, or at least one of them, to be under way prior to review in order to use them as the basis for a potential full-approval in the future. The company is thus planning to initiate the historically controlled study by the third-quarter of this year. In my view, that certainly sounds like the FDA is telling Sarepta that they are willing to use the appropriate protocols to allow eteplirsen on the market early, so long as the company fulfills a handful of clinical requirements.   

Foolish wrap-up
Investors and patient advocate groups have been overtly enthusiastic about eteplirsen's chances for accelerated approval ever since the drug showed promising mid-stage results over a year ago. What the past seven months should tell you, however, is that the FDA has a mind of its own in regulatory matters. My take is that the debate over the primary endpoint is still far from settled and the FDA really wants more data, especially in regards to eteplirsen's safety profile. The good news is that the FDA appears to be willing to let eteplirsen move forward, as long as Sarepta puts all the pieces into place for a potential full review down the road.  

George Budwell has no position in any stocks mentioned, and neither does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.