Traders turned bearish on Sarepta Therapeutics as shares fell sharply yesterday.

About 6,200 September 33 puts were purchased in the session, led by a print of 5,100 that went for $2.90, according to optionMONSTER's Depth Charge tracking system. The volume was far above the strike's previous open interest of just 151 contracts, clearly showing that these are new positions.

These puts lock in the price where traders can sell the stock no matter how far it might fall. The options will track the share price closely because they are well in the money and appear to be making an outright bet that SRPT will fall, rather than hedging a long-stock position. (See our Education section)

SRPT dropped 6.57 percent yesterday to close at $30.91. The stock hit a seven-year high of $47.35 on July 22 but plummeted $10 two days later on doubts that regulators would grant an accelerated-review process for the company's muscular-dystrophy drug. Shares have continued to trend lower since then and fell sharply yesterday, apparently on new concerns over data measurement.

Total option volume in SRPT topped 27,200 contracts yesterday, more than 8 times its daily average for the last month. Overall puts outpaced calls by more than 3 to 1.


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