Welcome to the Q1 2014 Sarepta Therapeutics Incorporated Earnings Conference Call. My name is Dawn and I will be the operator for today’s call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Please note that this conference is being recorded. I will now turn the call over to Jim Baker. Mr. Baker, you may begin.

Thank you, operator, and thank you all for joining today’s call. Earlier today, we released our financial results for the first quarter of 2014. The press release is available on our website at www.sarepta.com and our 10-Q was filed this morning. Joining me on the call today are Chris Garabedian, our Chief Executive Officer, Sandy Mahatme, our Chief Financial Officer, and Ed Kaye, our Chief Medical Officer. I’d like to note that during this call, we will make a number of statements that are forward-looking including but not limited statements about the timing of New Drug Application submission for eteplirsen, for the treatment of the Duchenne Muscular Dystrophy, the potential filing and acceptance of an NDA for eteplirsen by the FDA the timing and type of plan submissions of additional data analysis and other information to the FDA necessary for the FDA to make regulatory determinations the preparations for timing and design of and our ability to initiate additional studies for eteplirsen and our product candidates for other follow-on exons including exon 45 and exon 53. The sufficiency of our drug supply for the planned additional studies and our manufacturing scale up plans in connection with such studies and the potential commercialization of eteplirsen. The potential pathways to obtain approval or qualify under accelerate approval for eteplirsen, our future financial performance including revenues, expenses and financing sufficiency of our cash reserves with respect to our planned activities funding sources and collaboration and partnering opportunities. These forward-looking statements involve risks and uncertainties any of which are beyond Sarepta's control. Actual results could materially differ from these forward-looking statements as any such risks can materially and adversely affect the business, results of operations and the trading price of Sarepta's common stock. For a detailed description of risks and uncertainties we face, you're encouraged to review the Company's most recently filed annual and quarterly reports and other official corporate documents filed with the Securities and Exchange Commission. With that, let me turn the call over to Chris Garabedian, Sarepta's Chief Executive Officer. Chris?

Thank you, Jim. Good morning everyone and thank you for joining us today for our financial and corporate update for the first quarter of 2014. It is proving to be a very exciting year for Sarepta and this will be one of our busiest in the company’s history. Since the last quarterly earnings call we have received very clear guidance from the FDA on our regulatory and clinical path for eteplirsen and are now ready to work toward an NDA submission by the end of this year. We plan to move forward with our eteplirsen confirmatory study and two additional clinical studies with the eteplirsen in a broader patient population including younger patients and patients who are generally older and more advanced in their disease progression or non-ambulatory. Additionally, we continue to make progress on advancing our pipeline of investigational exon skipping therapies beyond eteplirsen for Duchenne muscular dystrophy and will begin our global clinical development of our follow on exon skipping drugs later this year beginning with our drug candidates targeting exon 53 and exon 45. We are hopeful that these next follow on exon skipping drugs will provide further evidence of the application of our technology across the large number of genetics subtypes that exist across the Duchenne patient population and will help lay the foundation for broader application of our morpholino technology to all the DMD patients that may benefit. Specifically, we expect that more than 25 drugs would be required to treat all the various genetic subtypes of Duchenne and many of these would treat a very small fraction that is about 1% or less of the DMD population. Today our current research pipeline includes 8 possible exon skipping therapies that have the potential to treat nearly half of the DMD population. Based on the CDC’s…

Good morning everyone. As Chris mentioned, we are now taking steps to initiate several clinical studies with eteplirsen and our follow on exon skipping therapies. I would like to walk you through the current status of these activities in some detail. While we plan to proceed with these studies as quickly as possible, it is important to understand that the study start our process involves a number of critical steps, these steps include the finalization of protocols a perfect review by the FDA and various IRBs identification and training of clinical trial sites and investigators contracting of a clinical research organization and the preparational release of drug supply. First let’s begin with our historically controlled eteplirsen confirmatory study. We expect this study to enroll about 60 to 80 ambulatory patients between the ages of 7 and 16 years. With the genotype’s amenable to exon 51 skipping, a parallel untreated cohort of patients we will also enroll approximately 80 patients with genotype’s not amenable to exon 51 skipping and will serve as a comparator arm for the eteplirsen confirmatory study. Eligibility criteria for the national history study will be similar to the confirmatory eteplirsen study accepted with enroll patients with genotype’s not amenable to exon 51. We had various, we had prepared for various scenarios in the months preceding the recent FDA guidance, the startup activities for the confirmatory study are well underway. We are now putting the finishing touches of the study protocol and we expect to submit it to FDA as well as selected IRBs in the coming weeks. We are on track to begin patient dosing in this study in the third quarter and rapid enrollment will be a key priority in the coming months. Once available we will post details such as the final eligibility criteria and…

Thanks Ed. Good morning everyone. This morning’s press release provided details for the first quarter of 2014 in both an adjusted or non-GAAP basis, as well as the GAAP basis. The press release is available on the SEC and company websites. The non-GAAP results we will discuss on this call provide a more accurate picture of our ongoing operations and the impact of operations on our cash balance and exclude the impact from the valuation of our outstanding warrants and stock compensation expense. Please refer to our press release for a full reconciliation of GAAP to non-GAAP. In the first quarter of 2014, we reported an adjusted or non-GAAP net loss of $20.7 million or $0.55 per share compared with the non-GAAP net loss of $13 million or $0.41 per share in the first quarter of 2013. The incremental loss is primarily the result of an increase of $9.1 million in non-GAAP operating expenses due to corporate growth offset by an increase of $1.6 million in contract revenue. Revenue for the first quarter of 2014 was $6.1 million, up from $4.5 million in the first quarter of 2013. The $1.6 million increase was primarily due to the timing of activities in connection with the Marburg portion of the July 2010 U.S. government contract. Adjusted research and development expenses were $19 million for the first quarter of 2014 compared to $13 million in the first quarter of 2013, an increase of $6 million. Adjusted general and administrative expenses were $7.8 million for the first quarter of 2014 compared to $4.8 million in the first quarter of 2013, an increase of $3 million. The company had cash, cash equivalents and short-term investments of $233.1 million as of March 31, 2014 compared to $264.9 million at December 31, 2013, a decrease of $31.8 million. On April 2014, we completed a $100.7 million underwritten public offering of 2.65 million shares of common stock at a price to the public of $38 per share. Aggregate net proceeds from the offering are approximately $94.5 million after deducting underwriting discounts and estimated offering expenses that were payable by Sarepta. The underwriters have an option to purchase up to an additional 397,500 shares of common stock on the same terms and conditions as the initial shares. With that I’d like to turn the call back over to Chris.

Thanks Sandy. Again, we’re very encouraged by the recent guidance from the FDA which we believe offers a clear path forward for eteplirsen and our follow on exon skipping candidate in the United States. As we move forward, we hope to obtain additional regulatory guidance in Europe and other geographies to expand our efforts to address the serious unmet medical need in DMD worldwide. As a next step we plan to seek scientific advice from the European Medicines Agency in the second half of 2014 with the goal of understanding what the European regulatory authorities will be looking for and a potential MAA or marketing authorization application for the approval of eteplirsen. These insights can inform our strategy for advancing our exon skipping platform for DMD in the region. Finally, I want to reiterate that our focus for the remainder of 2014 will be on execution. Since we announce the recent FDA guidance, we have heard from many families and patient advocacy groups who are excited to participate in the new clinical trials of eteplirsen and our follow on exon skipping therapy. They have also told us that they see a potential accelerated approval for eteplirsen as an important opportunity for the entire DMD field to take a significant step forward. We are honored to lead this effort and we will work very hard in the coming months to deliver for the DMD community. Operator, we can now open the call for questions.

Thank you. We will now begin the question-and-answer session. (Operator Instructions). Our first question comes from Tim Lugo from William Blair. Please go ahead.

Thanks for taking my question. Obviously, it is going to be a pretty broad development program over the remainder of the year. Can you maybe discuss also if you’re still looking at potential development partners for some additional product candidates in the pipeline? And then also Ed, if you can talk about the exon 53 and 45 studies; it sounds like there is going to be a placebo controlled study enrolling as well as potentially an open label study. Can you talk about enrolling a non-placebo controlled study while placebo controlled study is being enrolled at the same time?

Yes. Sure Tim. Look, we are well prepared to manage all of this. We obviously have been anticipating the confirmatory study with the eteplirsen and had already anticipated a untreated cohort of patients; we had those protocols prepared. We also had prepared a protocol that was placebo controlled. And we are going to be dusting that off to modify that to start to think about the follow on exon study. But I will have Ed comment on our preparedness and readiness to execute on all these studies.

Yes, I think one of the [Technical Difficulty] and we have increased our clinical staff and we’ll continue to increase to be able to handle below. So we feel very confident that the group we have will be able to execute on these clinical trials and don’t really anticipate needing any further assistance.

Thank you. Our next question comes from Brian Klein from Stifel. Please go ahead.

[Technical Difficulty] …..patients that we can talk about when there is a sufficient amount of data to compare to historical controls. Now we would expect that that would be somewhat informed by the FDA's understanding of the GSK data set, but they're not expressly saying that that is their primary controller measure. I think they're looking to show that overtime that this data would suggest that these boys are behaving differently than what the collective natural history or core historical control would suggest. So they have not highlighted that they would be specifically looking to the GSK data set for that comparison.

Okay, great. And then in terms of the enrollment of those 80 patients that are not amenable for eteplirsen in the same open label study. Will this be a purely observational cohort or will they have to undergo biopsies as well. And also will you include patients with exon 53 and exon 45 since you plan on initiating trials for those exons as well?

Yes. Let me answer the second question first and then I'll turn it over to Ed in terms of how we'll select for this. We are still working out the details, we think that if we can start following exon 45 and 53 patients as part of this untreated cohorts that that could be helpful and informative if they are well matched to include. Now, we would not want to preclude them from dropping out if they qualify for the placebo-controlled arm. And there even maybe ways to continue following them if they end up being randomized to the placebo arm, we could use that additional time of treatment as part of the comparison. But, we have to look at all of the details of how we would treat the analysis of this only had let's say 24 weeks or 36 weeks of a exon 45 or 53. We might include them, but ultimately exclude them from a primary analysis if we didn't have 48 weeks of follow-up. So, this is a very good question, but we have not worked out the detail. Ed, do you want to talk about our general philosophy of this untreated program?

Right. So I think, obviously we're very interested in making sure that we understand the natural history of the untreated cohort, because it has a lot of importance for all of the follow on exons and for eteplirsen. So, we will not require a biopsy, but the inclusion criteria will be very similar and we will be obtaining, the efficacy endpoints will be similar identical and we’ll collect safety data so that we can understand the differentiation between the natural history and what happens in these boys as part of their disease and anything that might be related to drug. So I think it will be a slightly easier participation, but very similar to the treatment group.

Great, thank you for taking my questions.

Thank you. Our next question comes from Brian Skorney from Robert W. Baird. Please go ahead.

Hey, good morning guys. Thanks for taking my questions. Just two quick ones really; I guess first can you just update us on the status of the FDA’s request for the fourth biopsy in the Phase 2b study? And can you just review what the current patent situation is for the other exons; do you feel that you have brought freedom to operate for the other exons or is there any way where in particular you think about region or an exon there is somewhat of a IP hurdle? Thanks.

Yes. Brian, [Technical Difficulty] believe that we’ll show this dystrophin in a fourth biopsy this would be done in a closer collaboration with the FDA to conduct it in a way that they’re aware of. But again this was not a requirement, but we do think that it will bolster an NDA submission and we do think it could bolster a more favorable of review or FDA advisory panel. So just to clarify that; and again we’re looking at the feasibility of that and we have a critical mass of patients, we will be pursuing that and we’ll provide the details accordingly. Related to the IP, again we are the most challenged on the freedom to operate front with eteplirsen and exon 46 particularly in Europe. With the other territories as it relates to the follow on exons in the U.S. and Europe, we are more confident and feel good about the freedom to operate we have on the broader constellation of exons and the rare exons that follow. If you recall we extended our collaboration with the University of Western Australia where we got access to another patent that they held which had more detailed sequences identified that we believe are more active. It had -- it gave us broader territory rights, it gave us more optionality beyond what we previously had with the top eight. And so we are very comfortable with that patent protection for our broader DMD portfolio as it relates to U.S and Europe and even other territories.

Great. And then if I could just ask one follow-up, just let me think about the placebo-controlled studies for the other exons, historically these are more than kind of 48 week studies. Any thoughts about doing a 96 week placebo-controlled study, do you think that that’s feasible, just seems like that would be of a much more definitive answer given kind of the extended timeframe that you see patients progress? Thanks.

Yes. I think based on what we’ve seen in 48 weeks we feel confident that both through the dystrophin expression and the six-minute walk test distance so that’s an adequate period of time, obviously we will continue to follow these boys in an extension study. So we will continue to have data on the six minute walk test at 96 and potentially farther beyond that. So I think at this point that should be very sufficient to get us the information that we need.

Great.

And Brian as you know it also relates to selection of the population, and we know more about the natural history and how these boys progress and that informs our view of the confidence that we have in showing a benefited 40 a week both in our eteplirsen versus an untreated cohort as well as even more so in a placebo control that is randomized in the same population. But obviously as we learn more and as everything unfolds we are going to look at all the different ways that we can prove the clinical benefit.

Thank you. Our next question comes from Chad Messer from Needham & Company. Chad Messer - Needham & Company: Great thanks for taking my question and congratulations on the progress. It’s really exciting to be at this point having a conversation about how to move forward. As you think about these various trials you have to design and run and I know you have been preparing for this moment, you probably have thought about this, what lessons have you learned or are you able to gleam either from your own 2b study or (inaudible) study in terms of what’s worked and maybe what can be improved upon in trial design, in biopsy collection inclusion, exclusion criteria whether you are going to cross over with the placebo et cetera, what are the lessons learned from trials run to-date that could be applied as you go forward?

Just a general comment on that Chad. So first of all, when we designed our Study 201, 202, we talked to experts, we looked at what was published in the literature, we looked at studies that had been completed and tried to learn from those published data. And that informed our view on the Study 201, 202. And we think we did a really good job of identifying the right population given the small sample size that was designed to show a treatment effect. We largely have been even further emboldened that we understand how to select the right population. The one thing that we modified is that, it does seem that the recent natural history and even experiencing clinical studies coupled with the fact that our technology has shown that there is a delay in meaningful dystrophin production that would lead to a stability of function that led us to increase that minimum 6 minute walk threshold. It was originally 200 meters at baseline; we've moved that up to 300 meters. But short of that, I think largely the selection criteria are similar. And actually what we've seen is more and more other companies and natural history analyses are basing this on the greater than seven year old population trying to cut it by baseline 6 minute walk. And so we think, we helped inform that dialogue as well. Ed?

Yes. And I think we have learned from previous trials, not only our own but from other companies. And I think the two things that are very critical is one, you really need to limit the number of sites that are doing the 6 minute walk test. They have to be experienced, they have to be trained. So, we spent a great deal of effort trying to making sure that we have the similar way of collecting the data. The other aspect I think that we did well in the previous study is you have to limit the number of sites that are doing the biopsies. So we will only be having two centers of excellence that will be collecting the biopsies or making sure that it's done in exactly the same way, so that we have really very good data. Because if we put these boys through a biopsy, we want to make sure that we have very good data that can stand up the scrutiny. And so, I think we've learned from that and we'll continue to follow through on the next study. Chad Messer - Needham & Company: Great. Thanks and best of luck.

Thank you. Our next question comes from Liisa Bayko from JMP Securities. Please go ahead

Hi, good morning. It's Heather in for Liisa, just a couple of questions for you guys. My first question is on the next exon, what you can refer if you can as far as dosing or what is expected for this exon compared to eteplirsen? Is the read through becomes the chemistry from one to the other?

Yes Heather. So, as it relates to dosing, look, we recognize that our technology is unique and that we believe we have a very nice wide therapeutic window. We now have a preclinical data across three exon skipping drugs where we've done the same experiment in monkeys and in mice and we see a high level of consistency and reproducibility across three different exons. Dosing after 320mg/kg in monkeys without seeing the dose limiting toxicities is across all of those same similar pharmacokinetics and will be compiling those final research reports and submitting them as part of the INDs later this year to the FDA to open those INDs to do the study. We know that there is a range of exon skipping that we believe is sufficient to produce a range of meaningful dystrophin production that would lead to general clinical benefit on outcome measures. So if you use that as a basis, we believe that the 30 mg/kg dose is well within the safety margin based on all the data that we collected to-date in preclinical studies. We understand we’re not seeing much additional benefit or no additional benefit looking at the 50 mg/kg dose. And so we feel strongly as we stated many times that 30 mg/kg per week is an appropriate dose across our platform. And we know that it’s infeasible to ever expect that we can do dose optimization in every single of the 25 or 30 exon skipping drugs that would be required for the DMD population. So our proof of concept is going to be based on 30 mg/kg and showing a reproducible data set on safety, on pharmacokinetics and on dystrophin production of a range that we believe is above the threshold. Now, we’re beginning a study in Europe where we’re going to quickly -- and this has been reviewed and approved in working with 4 of the leading DMD researchers clinicians in Europe for our EU grant study. We’re going to do a very rapid escalation as Ed described to get to 30 mgs/kg and then look at 30 mgs/kg. Now we will have that safety exposure data before we even start dosing at 30 mgs/kg in a follow on exon study that we described as placebo controlled. And so what we have to figure out is, is there any escalation data required given -- for exon 45, given that we have similar safety in preclinical studies and again a subsequent safety margin for that drug as well. And remember the FDA wanted us to move into a confirmatory study that could be powered obviously at a sufficient dose as quickly as possible. So we are contemplating all of that in trying to figure out how to quickly move to 30 mgs/kg with exon 45 and 53 in that placebo controlled arm. And that would be the basis to support a broader expansion into the follow on exons with that appropriate dose. Ed, do you want to add anything.

Yes. I think one of the advantages that we have is that the drug is very similar from different exon skipping drugs that we have. So all we’re changing is really the sequence in some of the variables are in the base pairs. So looking at that and the fact that it’s a relatively well behaved and well expected to be understood PK and its [excrete] is largely unchanged, that gives us some advantage. And so our expectations, obviously we won’t know until we do the studies, but then it should behave in a similar fashion. And even though there is going to be some variability in exon skipping depending on the deletions, the expectation is that so far from what we have seen, it should be very similar from one drug to another.

Yes. And let me just add, when we identify the linked sequence for eteplirsen, this was without the further work that’s been done and knowledge around our patents with University of Western Australia. We are trying to optimize all of the follow on exons and we’ve done this more recently with exon 53 and 45, but we are well underway with optimizing sequences for the other exon-skipping target. And we hope that we are going to have at least as efficient exon-skipping and may be the possibility of producing even more dystrophin than what we are seeing with eteplirsen that we believe is underlying the clinical benefited stability that we are seeing at eteplirsen exon-skipping efficiency at the 30 mg/kg dose. So again, we are very optimistic that we’re going to see a similar effect across the other exons, but of course we have to wait for the data to bear out and that will be coming on after we start enrolling that study.

Great, that’s really helpful. Thanks for the color.

Thank you. Our next question comes from Chris Marai from Wedbush Securities. Please go ahead.

Hi, good morning guys. Thanks for taking my questions. First maybe with respect to dystrophin measures -- in the last question and like color. I was wondering where is really the FDA, the EMA and scientific community with respect to these methods. I understand there is a growing body of (inaudible) quantification and measurement of dystrophin that’s been recently published. Where do you feel they are active in your recent times and how do you see that’s helping in dystrophin as a potential biomarker going forward? Thanks.

Yes Chris, as we described on the previous call, we have been working with the FDA very closely on the various methods we have used to-date that is immunofluorescence, dystrophin positive fibers and dystrophin intensity western blot, RT-PCR. And these are all measures that inform the dystrophin analysis and the FDA knows that. And they know and understand that we're going to continue to do these methods moving forward. The collaboration that they've asked us to do with them is to make sure that we are all on the same page. We're trying to optimize those techniques and figure out are we doing as a best way possible. And I can tell you before the FDA was even asking us to try to optimize this beyond what we believe was already state-of-the-art dystrophin analysis. Now with this collaboration, we think we're going to essentially have an even better method. And Ed, you want to describe this?

Yes, I think Chris; we've really been spending the last nine months trying to make sure that we have optimized every aspect of the dystrophin analysis. And especially with Art Krieg coming on Board, he has been helping us; we've been working with all, really the key opinion leaders in the world looking at this. And also remember, we’ve had several discussions with the FDA and they will look at our protocol and make sure that they agree. But I think at this point, this is going to be the state-of-the-art for dystrophin analysis by the time this study rolls out.

Great, thanks. That’s helpful.

Thank you. Our last question comes from Ritu Baral from Canaccord Genuity. Please go ahead.

Hi guys. Thanks for squeezing me in. You mentioned the global net of suppliers; Chris, what are your thinking as far as number of suppliers, capacity, geographical distribution and what it could mean for margins and supply capacity given the trials -- many trials you’ve got planned at this point?

Yes. Ritu, we're always going to be doing, we appreciate your coverage. So, here is the thing, we don't reveal the number of suppliers, who we’re using, what geographies, but we want to emphasize that we understand this is a big endeavor, okay. This is the first time morpholinos have been scaled up to this degree. We believe we're in the best position to do that. We've been producing morpholinos GMP grade at small-scale now at mid-scale and moving to large-scale. We have that knowhow, we have that confidence that we're imparting to various suppliers. But as we think about the encouraging guidance we received from the FDA, continued discussions with EMA and we think about what is that global capacity that we're going to need across U.S., Europe, other territories beyond eteplirsen in the follow on exon. You can start doing the math is that we're going to need much larger scale over the next several years and we're starting that now. And so, we want to get as many as suppliers as appropriate and as needed to have that morpholino capability so that we can have multiple sources for sub units, for API and can deliver the drug supply that we need around the world for both our clinical programs and commercial scale. And that's really why we wanted to emphasize that point is that we've begun that process and -- look, the manufacturers they read the press release too and they want to work with us, they want to prove that they can do and be our partner. And so, we think this is going to generate a lot of capacity around morpholinos. And then of course the follow on applications of our technology, we have to think about the capacity and capabilities beyond DMD. So that’s why we’re starting now and we’re trying to figure out the right suppliers to use globally to do that. And that’s how we’re prepared to talk about at this point.

Got it. And then last question just in terms of your placebo-controlled 53 and 45 trials. How are you planning on analyzing that data prospectively, what are the comparisons going to be. Is it going to be one-arm versus placebo, are you going to be able to combine activity in some capacity versus placebo? Is there a perspective plan that you’ve discussed with FDA on that powering?

Yes Ritu, obviously we don’t have all the final approval of the protocol from the FDA. But when we look at it (inaudible) we’ll be looking at the six-minute walk test since we’ll also be collecting dystrophin. We’ll compare to the entire population of the control group. We could look at individual, basically individual different amenable populations and look at that. But I think the expectation is that we’ll just be able to compare to the natural history and all the data we have so far that has been collected from a number of different centers, suggest that the individual exon deletions behave in a very similar fashion. So I think given the amount of data that we’ll have we should be able to differentiate between the placebo groups, the non-treatment group in our treated population.

Yes. And Ritu let me add that I mean obviously we’re going to be randomizing to make sure it’s matched by the exon amenable target too. So, however many we try to combine a 53, 45 or eventually we hope add some of the other exons in like exon 50, exon 44 we’ve identified exon 52, 55. So the more exposures we can get for safety pharmacokinetics and obviously dystrophin, we don’t need as many numbers to drive prove of dystrophin presence in the muscles. This starts to really add to the power and the ease of enrollment as we include exon amenable patients beyond 53 and 45. But all along the way, we would be randomizing similarly so there is, if it’s 2 to 1 for example that be two exon 53 treated for every one exon 53 placebo or two exon 45 treated for every exon 45 placebo and so on and so on. So again as Ed described, we are going to be submitting protocol to the FDA, we’ll get feedback and get more clarity on that path. And obviously just statistical analysis plan, we’ll have a number of permutations, but we think the best power is going to be in combining the multiple exon targets in a primary analysis with secondary analyses looking at what is the affect within the each exon.

Great, thanks for taking the question, guys.

Thank you. I will now turn the call back to Chris Garabedian for closing remarks.

Okay, thank you operator. As you can see, we are well prepared to execute on the various activities that we have in front of us for the remainder of the year and well capitalized to get it through all of these activities that lead us into an NDA filing by the end of this year for the possibility of an approval of the eteplirsen in 2015. As a reminder, we are hosting a webinar with the representatives of the DMD Patient Community next Tuesday where we will be answering questions about our DMD clinical program and what this means from the patient perspective. Until then, thank you for your interest in Sarepta. And have a great day.

Thank you, ladies and gentlemen. This concludes today’s conference. Thank you for participating. You may now disconnect.