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The Buzzing Gene-Editing Market Of Crispr Therapeutics

Bashar Issa profile picture
Bashar Issa


  • CRSR is one of the few companies that hold a patent to the 2020 Nobel Prize CRISPR technology.
  • The company's pipeline includes potential blockbuster medicines, demonstrating a more aggressive strategy compared to Editas Medicine, one of its main competitors.
  • The recent correction provides a buying opportunity for investors wishing to open a position in the biotech industry.

Investment Thesis

The promising clinical results of CRISPR Therapeutics' (NASDAQ:CRSP) pipeline combined with their blockbuster potential provide an attractive investment proposition for investors wishing to establish a biotech position.

CRSP is one of the few companies holding a patent to use CRISPR. This disruptive gene-editing technology helped its discoverers win the 2020 Nobel Prize, one of which is Emmanuelle Charpentier, the cofounder of CRSP.

The Gene-Editing Landscape

The new CRISPR technology might be the grande finale of humanity's quest for absolute control over aging and illness. It is a crack on creation that was once unimaginable. The 1990s' Human Genome Project gave us an understanding of our gene's functions. It was a landmark achievement and fascinating discovery, but for a long time, biotech companies weren't able to use this information safely on humans.

A pivotal point came in September 2017, when the FDA approved the first gene-editing medicine in its history. The drug, Kymriah, developed by Novartis (NVS), is a custom-made drug for acute lymphoblastic leukemia. Its action mechanism relies on extracting and gene-editing the patient's T-Cells, programming them to attack cancer cells before inserting them back into the patient. Soon after Kymriah, the FDA approved Gilead's (GILD) Yescarta with a similar action mechanism targeting large B-cell lymphoma patients.

The price of Yescarta and Kymriah drew criticism from politicians and the public, given that the two life-saving drugs cost $373,000 and $475,000, respectively, excluding hospital costs and required examination and tests to prepare the patient for the therapy. Another drawback is the lethal side effects inherent in the mode of action. Both drugs can cause cytokine release syndrome as cells inside the body fight each other. The remission rate (success of treatment) is around 55% for both drugs pushing the Institute for Clinical and Economic Review "ICER" to vote both Yescarta and Kymriah as "intermediate long-term value for money."

This article was written by

Bashar Issa profile picture
Bashar is a contributing writer at Seeking Alpha, focusing on Long/Short investment ideas, with a geographic focus in North America. Before that, Bashar worked at an Investment Fund in the United Kingdom. He has a Master's degree in Finance from the Queen Mary University of London and a Bachelor's degree in Economics from Middlesex University.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (22)

TruffelPig profile picture
As an add on - there are some other gene editing technologies. $DTIL has another one they call ARCUS. Honestly, I have no idea how competitive this technique is to CRSPR. The CRSPR Cas12 company btw is $BEAM. I am long basically all these ($NTLA, $EDIT, $CRSP). I sold a lot on the top and now I am reestablishing some positions catching falling knifes........I guess the post Nobel run up was a bit excessive.
indytom01 profile picture
Thank you for the historical context around the technology involved in these companies. (Quick edit note in the paragraph above entitled "Novel Technology" I think you mean to say the listed gene-editing technologies could potentially be made obsolete, not absolute.)
Scipio Advisors profile picture
CRSP will present a poster at the American Association for Cancer Research (AACR) Annual Meeting on Saturday, April 10, 2021.

Title: CD70 knockout: A novel approach to augment CAR-T cell function
Session Title: Adoptive Cell Therapy
Session Category: Immunology
Abstract Number: 1537, e-poster
Date and Time: Saturday, April 10, 2021, 8:30 a.m. ET via the AACR website,

This will likely be about CTX130 which is in Phase 1 right now. The following is the abstract of CRSP's last poster at AACR:

T cell lymphomas account for 10% to 15% of non-Hodgkin lymphomas and are diverse biologically and clinically. Unlike B-cell lymphomas, T cell lymphomas are rather resistant to conventional therapies, such as chemotherapy and antibody-based therapeutics. This resistance coupled with the diversity of the T cell diseases means that there is a significant unmet need across the T cell lymphoma subtypes.

CD70 (CD27 ligand) is a candidate target antigen for T cell lymphomas and has been the subject of clinical trials using an enhanced ADCC antibody (ARGX-110). Using flow cytometry and immunohistochemistry (IHC) methods, we analyzed the expression of CD70 in cell lines and clinical samples representing T cell lymphomas and found significant expression of CD70 in multiple types of T cell lymphoma, but at highly variable antigen density.

CAR-T cells targeting CD70 may thus be a potent new therapy to tackle these diseases. However, the use of autologous CAR-T therapy against T cell lymphomas is complicated by the likelihood of creating lymphoma cells carrying the CAR construct. Thus, we sought to examine the potency of our allogeneic anti-CD70 CAR-T cells (CTX130) against T cell lymphoma cells. CTX130 has previously been shown to be active across a range of CD70 expression levels in other cell types representing other malignancies. Consistent with these prior observations, CTX130 exhibited high potency in vitro and in vivo against T cell lymphoma cells across a range of CD70 antigen density and representing different types of T cell lymphomas such as Sézary syndrome and cutaneous T cell lymphoma (CTCL). CTX130 may thus be a valid therapeutic to evaluate in T cell lymphoma patients
You misspelled the company many times in the article. You need to proofread before publishing things.
I don't know anything about this technology and it may be wonderful and amazing, but this company has a Price to Sales Ratio of 10,400, has a market cap of over $8 billion, and generated total revenue of $720,000 (which is about what a well run convenience store generates). The cruise lines in 2020 with no people on them have better price to sales ratios than this.

This is an awful investment at this price.
Matthew Zeets profile picture
Isn't that sort of akin to saying you're over paying for said convenient store if you judge its multiple based on how much money it makes during the year it is still under construction? I think the point is that this technology isn't yet used in mainstream medicine, but people expect it to be used a lot in the coming years. I do agree with you that there's a lot of guess work and it is very unsure if CRISPR will end up being worth its current price.
@Matthew Zeets There is some value to the IP sure. Who knows if this will work well enough to get FDA approval and if it does, does someone beat them to it? Also, just because it gets approved, who knows whether they can actually mass produce it in a way where people will actually pay for it.

My point is that in the non-covid bubble world, something like this would be valued at a small fraction of what it is today. This isn't anywhere close to being worth $500 million right now, let alone $9 billion. If they get approvals, different story of course.
Matthew Zeets profile picture
I agree and I disagree. I do think the pandemic has made for very high premiums in let's call them future-tech/brands. However biotech companies with promising early stage trials but no where near a product yet will still trade at several billion dollars sometimes.

Gilead (GILD) paid $11B for Pharmasset in 2011 before they had $1M in revenue. They just had a very promising drug for HCV, which GILD went on to make $15B a year off of for a few years.

Arrowhead (ARWR) is one that comes to mind. They have revenue, but it's all from milestone payments on clinical achievements and deals with larger pharmaceuticals I'm pretty sure. I don't think they've actually sold a product yet.

I call it speculative, but for people that know the industry well, they probably know pretty well which drugs/therapies can eventually make it. In the end I am still on the sidelines with CRSP, but the rewards for such a potentially gigantic industry are worth the risk of potentially losing all or most of their money to some.
These seem highly speculative. I think that I will stick with an established biotech company that either has invested in these companies or has bought the license(s). If one is very knowledgeable or is somewhat of an "insider" in the biotechnology field then you might be able to make an informed decision. Right now it seems like you have to do the shotgun approach if you hope to hit the right company. I started out with ARKG but after reading a lot in SA and Bloomberg it looks like ARKG has a big influence on the price which won't fare well with fund outflows.
SenBiden profile picture
As an income investor I learned late about this marvelous technology. Thinking much of the $ had been made in CRSP I started a small position in EDIT and sold puts taking advantage of high premiums. Won't mind being put the shares to get a low cost foothold in this industry. I like both firms, but EDIT's prospects a bit more based on my limited knowledge. Thanks for article.
@Bashar Issa thank you for the great analysis!

In my opinion, all companies in which ARK has a significant position are overvalued by at least 200%.

If a significant general market correction of 30-60% will happen during the next 6-8 months, these hype inflated ARK companies will go to the floor.
Chimpanzee ate my face profile picture
@Daniel07 Cathy Woods is the Henry Blodgett of our time. After the coming crash, her name will live in infamy.
@Daniel07 I feel dumber for reading this comment
@Garibaldo what do you mean?

1. ARK is very famous. Millions of people watch what companies ARK is buying and they buy as well those companies, with or without a serious analysis. The result: significantly inflated prices. They buy thinking that if ARK bought the stock, it "must" be great.

2. During a severe market decline people retire money from ARK funds. So, ARK funds must sell their positions. Because they have important positions in some companies, the prices will go down fast and deep. Also, millions of people will see "ARK is selling" and they will start to sell as well in panic. The companies from ARK's portfolio will go down faster and deeper than the market.
Thanks for the history and explanation in clear language.
Matthew Zeets profile picture
Thanks for the article explaining their technology better. I've only heard about it from the ARKG ETF so far.
tjf@denver profile picture
I bought crisper when I thought I was buying kriosy crepe donuts
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