Regenxbio Inc. (RGNX) is having a rough Monday. The biotech's stock took a nosedive after the U.S. Food and Drug Administration (FDA) slapped a clinical hold on its experimental gene therapy for Hunter Syndrome, RGX-121. The reason? Some unexpected findings on spine MRIs in a handful of patients.

FDA Puts the Brakes on RGX-121

The FDA's decision came after five participants in the CAMPSIITE study showed asymptomatic spine MRI findings. These aren't causing any symptoms, but they're enough to give regulators pause. Regenxbio said it doesn't expect to resubmit the Biologics License Application (BLA) for RGX-121 anytime soon.

Here's the thing: all five participants are doing fine clinically. They've shown overall stability or even improvement on neurocognitive and neurobehavioral assessments. So what's the fuss about?

What the MRIs Found

The findings were spotted thanks to an expanded MRI monitoring plan that Regenxbio rolled out a few months ago. That plan came after a previous clinical hold on another therapy, RGX-111. The enhanced monitoring included both brain and spine MRIs, and it turned up either a small nodule or a small cystic mass in the spine MRIs of five participants who had received RGX-121 via intracisternal or intraventricular injection roughly three to six years ago.

Investigators have deemed these findings nonserious, and radiologists believe they're likely benign. But there's no clinical or pathological evidence yet to confirm what these findings are or what caused them. Notably, no brain nodules or masses were found on any brain MRIs.

What Happens Next?

Because spine MRIs aren't typically done for MPS patients in clinical practice or trials, the underlying prevalence and clinical significance of these asymptomatic findings in this patient population are unknown. That's a key uncertainty. Investigators plan to keep observing these patients with periodic imaging only.

Regenxbio and its partner NS Pharma are digging into additional patient imaging and longer-term follow-up data. They'll also incorporate FDA feedback, including the full clinical hold letter once they receive it, into their next steps for RGX-121.

Understanding Hunter Syndrome and RGX-121

For those unfamiliar, MPS II, or Hunter Syndrome, is a rare, X-linked recessive disease. It's caused by a deficiency in the lysosomal enzyme I2S, which leads to a buildup of glycosaminoglycans (GAGs), including heparan sulfate, in tissues. That buildup ultimately causes cell, tissue, and organ dysfunction, including in the central nervous system.

It's a rare condition, with about 2,000 patients diagnosed worldwide and more than 500 babies born with the disease each year.

RGX-121 is designed as a one-time gene therapy. It delivers the iduronate-2-sulfatase (IDS) gene to the central nervous system. The idea is that by delivering the IDS gene into cells within the CNS, the body can produce a permanent source of the I2S protein beyond the blood-brain barrier, allowing for long-term cross-correction of cells throughout the CNS. The protein expressed by RGX-121 is structurally identical to normal I2S.

As for the stock, Regenxbio shares were down 23.79% at $8.170 during premarket trading on Monday, according to market data.

It's a setback, but not necessarily a fatal one. The patients are stable, the findings are likely benign, and Regenxbio is committed to figuring out what's going on. But for now, the road to approval for RGX-121 just got a lot longer.