Shares in PepGen jumped about 160% on Tuesday after the Boston biotech reported the strongest early results yet seen for its experimental treatment for myotonic dystrophy type 1, a rare muscle-wasting disease with no approved therapy that tackles its underlying cause.

The clinical-stage company said its drug candidate, PGN-EDODM1, produced a mean splicing correction of 46.5% in muscle at week 13 in the 10 mg/kg group of its ongoing Phase 2 FREEDOM2-DM1 trial. Five of the six patients who received the drug passed 20% correction and four passed 50%, while patients on placebo averaged 6.8%.

Analysts call data a possible new benchmark

Analysts at Guggenheim Securities described the result as potentially the new benchmark for splicing correction in the disease, known as DM1. The figure compares with a 25% mean correction reported by rival Dyne Therapeutics for its own DM1 candidate in an earlier-stage trial.

PepGen said patients also showed improvements across several measures of muscle function. Video hand opening time, a measure of myotonia, improved by 3.9 seconds, or 52.7%, from the start of the study by week 16, and the company reported gains in handgrip strength, balance, walking and mobility.

The drug was generally well tolerated, with no serious or severe side effects and no dose-limiting toxicities reported in the group, the company said.

Small trial, closely watched field

The results come from a small group: eight people were enrolled in the 10 mg/kg group, six receiving the drug and two receiving placebo, dosed by intravenous infusion every four weeks. PepGen has fully enrolled a higher 12.5 mg/kg group and expects to report first clinical results from that group in the first half of 2027.

DM1 is a rare, progressive genetic disease that gradually robs patients of muscle control and strength, usually from adolescence, and affects more than 100,000 people in the United States and Europe. PepGen's drug is designed to correct the faulty splicing of genetic messages that drives the disease.

The field is closely watched. Dyne Therapeutics is near completing a late-stage trial of its rival DM1 drug, while Novartis recently reported that a DM1 drug it acquired in its $12 billion purchase of Avidity Biosciences failed to improve a key measure of muscle control in a Phase 3 trial.

PepGen shares rose to $6.21, up 159.83% on the session, on heavy trading of 67.27 million shares, according to market data. The company, which is listed on the Nasdaq under the ticker PEPG, develops oligonucleotide therapies for severe neuromuscular and neurological diseases.