After a turbulent September, genome-editing company CRISPR Therapeutics AG (NASDAQ:CRSP) saw its shares gain 8% last month, according to S&P Global Market Intelligence. Although the company did announce the promotion of President Samarth Kulkarni to CEO at the start of the month, as well as a new grant from the Friedreich's Ataxia Research Alliance toward the middle of October, this march northward doesn't appear to have an underlying material catalyst.
As CRISPR is years away from bringing a major product to market, and the field of genome editing in general remains in its infancy, it's not entirely surprising that this small-cap biotech's shares tend to be rather volatile from month to month. In short, CRISPR's stock is largely reacting to the whims of day traders at the moment due to the lack of solid fundamental news.
The bright spot is that CRISPR is going after some absolutely huge game with its unique gene-editing platform, which may make a small investment in its stock worthwhile right now. As an example, the biotech is hoping to turn the emerging adoptive cell therapy field on its head by developing "off-the-shelf" chimeric antigen T cell therapies (CAR-T) that won't require patients to visit a clinic first to extract their T cells.
Such a therapy would easily be worth billions if approved, based on the lofty commercial expectations for both Gilead Sciences' and Novartis' newly approved CAR-T therapies. The downside risk, though, is that there's no guarantee that genome editing will live up to the hype, or that CRISPR will even be the company to usher in this new era of genetic manipulation. As a result, investors probably don't want to go hog wild in terms of buying with this speculative biotech just yet -- despite the potentially disruptive nature of gene-editing technology.