Wednesday, April 17, 2024

3 Reasons to Buy CRISPR Therapeutics Stock Like There’s No Tomorrow

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investors look at tablet outside

CRISPR Therapeutics (NASDAQ: CRSP) has climbed more than 60% this year — and for good reason. The company and partner Vertex Pharmaceuticals delivered positive results from clinical trials of their blood disorders candidate, exa-cel, and investors bet on potential regulatory approvals to follow.

In recent weeks, investors won that bet. Regulators in the U.K. authorized exa-cel — to be commercialized as Casgevy — for sickle cell disease and beta thalassemia. U.S. regulators approved the gene-editing treatment for sickle cell and aim to issue a decision on the second blood disorder early next year.

All of this marks just the beginning of a great opportunity for long-term investors. Let’s check out three reasons to buy CRISPR Therapeutics like there’s no tomorrow.

Two investors look at something on a tablet outdoors.

Image source: Getty Images.

1. The regulatory vote of confidence

The recent regulatory nods for Casgevy represent more than just an OK to go ahead and sell the product. These decisions also may be seen as a vote of confidence in a new technology. The U.K. decision was the world’s first authorization of a treatment based on CRISPR gene editing.

Regulators often consider new technologies with an extra layer of caution, so the fact that they have given Casgevy a thumbs up means CRISPR Therapeutics has made it over a particularly difficult hurdle. And as real-world data from Casgevy accrues, we could imagine regulators gaining confidence about the technology.

This is great news for CRISPR Therapeutics because the company’s pipeline is based on CRISPR gene editing — and now we know regulators are willing to let these types of products enter the commercial market.

2. A new focus on next-generation candidates

CRISPR Therapeutics recently said it’s shifting its focus to its next-generation immuno-oncology candidates and dropping its initial ones — including a candidate that was in late-stage development.

The bad news is shelving the late-stage candidate may slow the time to market, but the good news more than compensates. Data from trials of all the candidates show the later-stage ones offer potential for greater efficacy and therefore better patient outcomes. Stronger candidates are more likely to win regulatory approval, as well as stand out in the highly competitive oncology drug market.

At the same time, CRISPR Therapeutics sees potential for these candidates to treat autoimmune diseases too, so it is expanding into that area. The biotech aims to launch a trial in systemic lupus erythematosus in the first half of next year.

So, this new focus brings CRISPR Therapeutics the possibility of more indications for a potential product and a greater chance of success in oncology.

3. Upcoming product sales

Finally, it’s important to note that new product Casgevy is just getting started when it comes to powering share price gains. Sure, investors piled into the shares earlier this year in anticipation of an approval. Now, though, investors could open a position in or add to positions in CRISPR Therapeutics as the company reports product sales growth.

Casgevy is the company’s first commercialized product, and it holds blockbuster potential. CRISPR Therapeutics and Vertex say right now, thanks to the sickle cell approval, about 16,000 people may be eligible for the treatment. It might take time to roll out the therapy, as it requires several treatment steps over a few months, and the companies still are negotiating with payers regarding coverage.

But Casgevy, thanks to its one-time curative profile, is likely to at least spark the interest of many doctors and patients — especially considering treatment options are limited for sickle cell and beta thalassemia today.

So, even if sales don’t soar overnight, there’s reason to believe they will progressively grow — and this could drive shares of this innovative company higher over the long term. That’s why you’ll want to stock up on this leading gene-editing company today, early in its growth story.

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Adria Cimino has positions in Vertex Pharmaceuticals. The Motley Fool has positions in and recommends CRISPR Therapeutics and Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.

3 Reasons to Buy CRISPR Therapeutics Stock Like There’s No Tomorrow was originally published by The Motley Fool

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