Design Therapeutics stock plunges on trial results for neuromuscular disease treatment

Shares of Design Therapeutics Inc. (DSGN) dropped 45% in premarket trading Tuesday after the biopharma company reported mixed results from an early-stage trial of a treatment for Friedreich ataxia, a genetic neuromuscular disease. The phase 1 trial of the treatment, DT-216, confirmed clinical activity in patients with the disease but also found injection-site reactions, the company said in a release late Monday. While the findings support the continued development of the treatment, Design said it will improve the formulation to address the injection-site reactions and begin another early-stage trial in the second half of next year, with initial data expected in early 2025. Wedbush Securities analysts on Tuesday downgraded Design shares to neutral, from outperform, and cut their price target for the stock to $6, from $19, saying the earliest potential commercial launch of DT-216 is now in fiscal 2029. Design Therapeutics shares are down 29% in the year to date, while the S&P 500 has gained 17%.

-Eleanor Laise

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08-15-23 0817ET

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