After reporting data from trials evaluating an innovative gene therapy for hemophilia patients, shares in Spark Therapeutics (ONCE) lost 29.8% of their value in December, according to S&P Global Market Intelligence.
Medicine that targets disease by tinkering with DNA is perhaps the most exciting advance in medicine right now, but excitement over Spark Therapeutics fast-approaching first commercial stage gene therapy wasn't enough to overcome concerns that BioMarin Pharmaceutical (BMRN 0.28%) could outflank it in hemophilia A.
There are 151,000 people living with hemophilia A worldwide and hemophilia treatment is a multi-billion dollar market. Hemophilia A is characterized by an inability to produce an adequate amount of blood clotting factor VIII that in turn exposes patients to a risk of severe bleeds. It's a chronic condition requiring a lifetime of regular infusions of the missing clotting factor.
At the American Society of Hematology conference in early December, both Spark Therapeutics and BioMarin reported impressive results from ongoing hemophilia A trials evaluating one-and-done gene therapies that restore a patients' ability to produce factor VIII. Spark Therapeutics' SPK-8011 eliminated bleeding events and boosted factor VIII activity by between 9% and 37%, while BioMarin Pharmaceutical's BMN-270, or valoctocogene roxaparvovec, eliminated bleeding events and boosted activity by 49%.
Given BioMarin's therapy appears to increase activity, investors fled from Spark Therapeutics shares on the fear that it wouldn't be able to win sales in what's likely to be a big market opportunity.
The hemophilia A data wasn't the only news reported by Spark Therapeutics last month, though. Management also reported efficacy for its hemophilia B drug, SPK-9001, and the FDA gave an earlier-than-expected OK to the company's Luxturna, a gene therapy that can restore vision in patients with a rare genetic disease.
BioMarin isn't developing a hemophilia B gene therapy and there aren't any drugs that can restore vision like Luxturna can. The hemophilia B market is smaller than the market for hemophilia A, with about 30,000 people globally, but it could still be a nine-figure source of sales someday. Similarly, while Luxturna can only help less than 2,000 people, it's $850,000 price tag still means tens of millions of dollars in sales over the next year or two.
It may not be wise to count Spark Therapeutics out in the hemophilia A market, either. Management's still optimizing dosing, so future trials may produce data showing a bigger increase in factor VIII activity. Even if that's not the case, most doctors view activity greater than 12% as enough to significantly lower the risk of severe bleeds. Because of those two points, this race may not be over.