U.S. Food and Drug Administration staff reviewers said clinical data to date did not merit approving BioMarin Pharmaceutical Inc's muscle-wasting disorder drug.
The FDA staff reviewers raised questions over the clinical benefit of the drug, drisapersen, and said long-term data submitted by BioMarin did not support an approval at this time.
BioMarin's shares fell 8.7 percent to $94.15 in premarket trading on Friday.
Shares of Sarepta Therapeutics Inc, which is developing a rival treatment, jumped 23 percent to $32.
"The conclusion of this review is that substantial evidence of clinical efficacy was not established for drisapersen in the treatment of exon 51-skip amenable DMD," staff members said in a document released on Friday.
The FDA staff reviewers also expressed concerns over the side-effects of drisapersen on kidneys.
Piper Jaffray's Joshua Schimmer said that while the FDA staff was highly critical of the drug, they had stopped short of recommending drisapersen not be approved.
The staff recommended BioMarin conduct additional studies on the drug's effect in children 5 years or younger and on how the body's immune system reacted to the drug.
The company is still testing the long-term effects of drisapersen in patients with DMD. The study is expected to be completed by April, according to a federal database of clinical studies.