(Reuters) - Sarepta Therapeutics said on Tuesday that a 16-year-old boy died from acute liver failure months after receiving the company's U.S-approved gene therapy for a rare muscular dystrophy.

The patient underwent treatment in December with Sarepta's therapy, called Elevidys, the company told Reuters in an emailed statement. Elevidys is the only FDA-approved gene therapy for Duchenne muscular dystrophy (DMD) patients aged four and above.

Liver damage is a known risk with Elevidys and other gene therapies that use adeno-associated viral vectors to infuse modified genes.

This was the first death reported in a patient who was treated with Sarepta's Elevidys, though fatalities are not new to gene therapies.

Novartis in 2022 reported two patient deaths due to acute liver failure following treatment with Zolgensma gene therapy used to treat spinal muscular atrophy.

Sarepta, however, said testing showed the patient also had a recent infection, called cytomegalovirus, which can affect the liver, and it was identified by a treating physician as a possible contributing factor.

Shares of the company declined 26.3% to $74.55. More than 8.2 million shares had exchanged hands in the first few hours of trading, compared to stock's 50-day-average of nearly 920,000 shares.

While the news puts a "black eye" around Elevidys, the therapy's longer-term benefits for patients have been encouraging, Piper Sandler analyst Biren Amin said. He added the therapy was not likely at risk of being withdrawn from the market.

To date, Sarepta's therapy has been used to treat more than 800 patients in clinical trials or as a prescribed therapy, the company said adding that it plans to update the therapy's prescribing information to represent the death. 

Elevidys, which failed to meet the main goals of a late-stage trial, has been dogged by regulatory delays and questions about its effectiveness. 

Leerink analyst Joseph Schwartz said the patient who died was likely treated with a higher dose, as the dosage is determined based on a patient's weight.

At least two analysts said the patient's death could make doctors more hesitant about using Elevidys in patients. "For doctors, they clearly have to be very selective in terms of who they treat and when they treat with Elevidys or with any other gene therapy," said Amin.

The drug was first approved under the FDA's accelerated pathway for boys aged between four and five years who can walk, and last year received traditional approval for patients aged four and older who can walk, and accelerated approval for those who cannot.

The FDA, in an emailed statement, said it takes these matters seriously and that "the agency thoroughly reviews and investigates any reports of serious adverse events or deaths potentially associated with FDA-approved products".

The accelerated approval was based on the drug's ability to produce a mini version of dystrophin protein needed to help keep muscles intact. The traditional approval was based on data from a late-stage trial that showed the therapy helped improve the time it took for patients to rise from the floor and their ability to walk 10 meters.

DMD affects an estimated one-in-3,500 male births worldwide, according to the National Organization for Rare Disorders. It weakens skeletal and heart muscles, which quickly get worse with time, and patients often die by the time they are 25.

In an infusion, Elevidys delivers a gene that produces microdystrophin, a shortened version of the dystrophin protein that is missing in DMD patients.

(This story has been refiled to correct the spelling of 'microdystrophin' in the story)