Biotech Roundtable: Is CRISPR all it's cracked up to be?

CRISPR gene editing technology has been heralded as a revolutionary breakthrough in drug development, enabling scientists to potentially cure genetic diseases by modifying the genes that cause them.

The technology grabbed headlines last fall when the FDA approved the first CRISPR product for the US market, Casgevy, a gene therapy for the treatment of sickle cell disease developed by Vertex Pharmaceuticals (VRTX) and CRISPR Therapeutics (NASDAQ:CRSP). Both stocks saw strong run-ups ahead of regulatory approvals in the US and EU, further stoking investor interest in the technology.

Despite the fanfare, questions remain about this emerging field of drug development, including:

• Is CRISPR overhyped?
• Which companies are most attractive right now?

To answer these questions, we reached out to Seeking Alpha biotech analysts Stephen Ayers, Edmund Ingham and Terry Chrisomalis to see what they had had to say about this intriguing space and the companies that are working in it.

Do you think CRISPR is overhyped?

Stephen Ayers: Despite the regulatory approvals of breakthroughs like CRISPR Therapeutics' Casgevy for sickle cell disease, we are still in the very early innings of gene therapy in general. Challenges of long-term efficacy, real-world utilization, unintended genetic modifications, and ethical debates on human gene editing should balance any excessive optimism.

Edmund Ingham: I don’t think the technology is overhyped -- if anything it is undervalued by the market. This is Nobel Prize-winning technology, after all, that is quite ingenious, leveraging the natural defense mechanisms of bacteria against viruses. In its pivotal studies in sickle cell disease and transfusion-dependent thalassemia, Casgevy was able to “functionally cure” patients, saving them from a lifetime of painful vaso-occlusive attacks and regular hospitalizations, and potentially allowing them to live longer, healthier, and more active lives.

With that said, there are still many issues to be overcome. Presently, patients must undergo painful preconditioning regimes before engineered cells can be delivered, meaning months in hospital, and although the therapy appears safe, long-term side effects are unknown, and issues around fertility are troubling. As important as the gene editing mechanism itself is the actual delivery of the drug, and the next frontier for CRISPR therapies, is to try to work towards in-vivo delivery of CRISPR, which will make things much more palatable for patients. If that can be achieved, the sector will explode.

Terry Chrisomalis: CRISPR technology is not overhyped at all. As a matter of fact, there is a lot of promise with respect to this type of technology. The ability to edit DNA is pretty amazing in itself, if you think about it. Cutting a double-stranded DNA with Cas9 or another cleaving mechanism to provide a properly programmed edited DNA in its place could help cure a lot of diseases.

It is not overhyped in that sense at all, but there is a major problem with this technology. Specifically, initial Cas9 proteins being deployed, because of off-target effects and other safety problems associated with it. For example, the ability to edit DNA is ideal, but on the flip side, such genome editing can lead to cytotoxic DNA damage. In essence, by attempting to repair the DNA in question, it may be inadvertently damaged. I don't believe that this type of technology is overhyped, but it definitely needs refinement in a lot of key areas.

Which companies are most attractive right now in the space and why?

Stephen Ayers: My enthusiasm for Intellia Therapeutics (NTLA) remains strong, particularly given its attractive valuation. It stands out as a bargain compared to peers like CRISPR Therapeutics. Intellia's focus on diseases such as ATTR amyloidosis and hereditary angioedema is commendable. ATTR amyloidosis, in particular, offers a vast market opportunity, reflecting a significant unmet need. The company's precise use of CRISPR-Cas9 for in vivo treatments distinguishes it.

Edmund Ingham: For my money, CRISPR Therapeutics remains the stand-out company. It is now commercial stage, and has an impressive array of pipeline projects, including cell therapies and next-generation sickle cell disease and transfusion-dependent thalassemia programs that will ease the preconditioning burden, and, most excitingly of all, in vivo programs that are slowly coming to fruition.

Many analysts regard Editas Medicines' (NASDAQ:EDIT) sickle cell program as potentially best-in-class, although progress has been painstakingly slow, while the potential of Beam Therapeutics' (BEAM) base editing is exciting. I also like Verve Therapeutics (VERV), which, in partnership with pharma giant Eli Lilly (LLY), is making exciting progress in the in-vivo space, targeting PCSK9 and ANGPTL3 genes, in cardiovascular conditions.

From an all-round perspective, however, CRISPR Therapeutics remains my top pick. Strong management, extremely well-funded, with a proven ability to execute and the first company to win approval for a CRISPR therapy. The company’s CEO, Dr. Samarth Kulkarni, has discussed his aims to turn the company into a $25B market cap, successful, commercial stage pharma, and I believe that ambition may be achievable.

Terry Chrisomalis: I believe that Editas Medicine would be the most attractive company in the CRISPR space and I believe this to be the case because of the differentiated nucleases it deploys. How so? Well, that's because while it does have the use of Cas9 as one nuclease to cleave DNA with genetic edits, it also deploys the use of another known as Cas12a. Both use bacteria to cleave DNA, which is part of the CRISPR technology, but the point being that this company can target a greater range of disorders because of the Cas12a nuclease.

Another reason why I believe Editas Medicine is the most attractive company in this space, besides the Cas12a nuclease development, would be that it is the exclusive licensee of certain CRISPR patent estates for making human medicines. This includes Cas9 patent estates owned and co-owned by Harvard University, Broad Institute, Massachusetts Institute of Technology and The Rockefeller University. This was a patent decision made back in 2022 and for now Editas will greatly benefit because of it. Vertex Pharmaceuticals had to make a deal with Editas to obtain non-exclusive Cas9 for Cagevy.

My final reason why this biotech is most attractive in this space is because of a quicker pathway to U.S. marketing approval of reni-cel for severe SCD patients. That is, the phase 1/2/3 study is being allowed to be a registrational one, where a BLA filing could happen on the basis of key positive data being achieved.