Imagine a world where genetic diseases don't exist.

That might seem like a huge leap of the imagination, considering that there are over 6,000 diseases caused by genetic mutations impacting more than 430,000 newborns each year. But one of the greatest scientific breakthroughs of our generation -- gene editing -- holds the potential to usher in a world without genetic diseases. And an approach for gene editing discovered only six years ago, CRISPR (Clustered Regularly Interspaced Short Palindromic Repeats), could be the key for making it happen.

Researchers across the world are using CRISPR to hopefully make the wonderful dream of curing genetic diseases into a reality. Where there are dreams that could be fulfilled, there are usually also investing opportunities. For CRISPR, those investing opportunities definitely exist.

Investing in something complex like CRISPR gene editing might seem like a daunting task. But don't worry. There are really only a few key things you need to know. 

Large DNA helix with scientist in background "cutting" the DNA

Image source: Getty Images.

What CRISPR gene editing is

You might recall from your high school or college biology class that genes are the basic units of heredity. Genes serve as the blueprint for building proteins, which in turn are the building blocks for every living organism on Earth. You probably also remember that genes are made up of DNA (deoxyribonucleic acid).

DNA's structure looks like a twisted ladder. The "steps" on this ladder are called base pairs, because they contain pairs of chemical bases. There are four kinds of chemical bases: adenine (A), guanine (G), cytosine (C), and thymine (T). Adenine always pairs up with thymine, while cytosine always pairs with guanine. A human gene can consist of anywhere between a few hundred of these DNA base pairs to well over 2 million base pairs. 

The first hint of the repeating CRISPR DNA sequence came in 1987 while Japanese scientists were studying E. coli. It wasn't until 1993, however, that Clustered Regularly Interspaced Short Palindromic Repeats, or CRISPR, would gain its name. So what's behind this clunky name? These short palindromic (which means they read the same forward and backward) repeats of DNA base pairs were clustered together. And they had regular stretches of what's called "spacer DNA" (a kind of DNA that doesn't provide instructions for building proteins) between them. 

Over the next couple of decades, researchers discovered that bacteria used CRISPR-associated system (Cas) proteins to defend against attacks from viruses. These Cas proteins actually cut up the DNA of viruses as if they were molecular scissors. Eventually, scientists learned that CRISPR didn't have to be limited to use by bacteria on viral DNA. Humans could also use CRISPR to edit the genes of any living organism. 

How CRISPR works

Certain types of bacteria are smarter than you might think. When a virus attacks, bacteria such as Streptococcus pyogenes use a DNA-cutting enzyme called Cas9 to fight back. After defeating the virus, the bacteria actually incorporates small snippets of the virus DNA into its own set of DNA.

Is it just a trophy from battle? Nope. The next time that kind of virus attacks, the bacteria unwinds the stored DNA and uses it to create "guide RNA." This guide RNA (ribonucleic acid) then hooks up with a Cas9 enzyme. The Cas9 enzyme uses the guide RNA to target the same DNA in the virus that the bacteria previously stored and snips it away. 

The process is a little different when scientists use CRISPR to edit genes. Scientists have to build the guide RNA on their own. But they have the pattern for doing so: It's the segment of DNA that they want to cut -- for example, a genetic mutation that causes cystic fibrosis. After building the guide RNA, the scientists inject it into a cell along with the Cas9 enzyme. Cas9 connects with the guide RNA and goes to its business of slicing out the targeted DNA in the cell.

Cas9 isn't the only CRISPR-associated system enzyme that can be used for gene editing. There's Cas3, Cas9, and Cas13 as well. Cpf1 (which stands for CRISPR from Prevotella and Francisella 1) is another enzyme that can also be used to cut DNA in a similar way as Cas9. (Prevotella and Francisella, by the way, are two other kinds of bacteria.) It's possible that more CRISPR enzymes will be discovered in the future. 

Advantages of CRISPR

CRISPR wasn't the first method of gene editing to come along. Zinc finger nuclease (ZFN) technology has been around since the early 1990s. With ZFN, zinc finger DNA-binding proteins (ZFPs) can be engineered to bind to and cut specific DNA. After the cut, the cell tries to repair the broken DNA. ZFN can be used to insert new DNA in between the broken ends during this cellular repair process.

TALEN (transcription activator-like effector nuclease) is another gene-editing method discovered in 2009. While CRISPR is used by some bacteria to fight against viruses, TALEN is used by Xanthamonas bacteria to infect plants. To use a football analogy, CRISPR plays defense while TALEN plays offense. 

So how does CRISPR stack up against these other gene-editing approaches? Its proponents -- and there are a lot of them -- argue that CRISPR is cheaper, simpler, and better than either ZFN or TALEN.

The cost advantage for CRISPR seem to be pretty clear. Soon after CRISPR-Cas9 started to be used for gene editing, the price for the technique was at least 80% cheaper than both ZFN and TALEN. That price difference has been a key factor in the popularity of CRISPR taking off over the last few years. There are now tens of thousands of guide RNA sequences that have been created and are available for scientists to use.

CRISPRs don't have to be paired with separate "cleaving enzymes" like other methods do, which makes the method simpler to use. It's also easy to match CRISPRs with guide RNA. Jennifer Doudna, one of the pioneers of CRISPR, once spoke about a colleague who was attempting to edit genes in mice with TALENs. Several months later, the colleague gave up after failing with seven different enzymes used for targeting. The researcher subsequently used CRISPR-Cas9, succeeding with all seven targets within three to four weeks.

Another major advantage for CRISPR is that it can be used to target multiple genes at the same time by adding multiple guide RNA. This capability can speed up the gene editing process compared to ZFN and TALEN.   

Potential problems

In May 2017, an article was published in Nature Methods that claimed CRISPR-Cas9 could cause hundreds of unexpected mutations. This caused some to doubt that CRISPR was all it was cracked up to be. 

But fast-forward to March 2018. The research team that wrote the article that was critical of CRISPR-Cas9 did an about-face. They retracted the original article and published a corrigendum (error correction) on scientific website bioRxiv (pronounced "bioarchive"). In their correction, the researchers stated that "CRISPR-Cas9 editing can precisely edit the genome at the organismal level and may not introduce numerous, unintended, off-target mutations." The problems with CRISPR-Cas9 alleged initially turned out to be much ado about nothing.

However, there are some legitimate potential drawbacks for CRISPR. In January 2018, a Stanford University team posted a paper on bioRxiv that discussed their research showing that many people could have antibodies for the Cas9 enzyme. Since the purpose of antibodies is to fight against foreign substances in the blood, this could present a challenge for using CRISPR-Cas9.

This issue isn't all that surprising. The two bacteria most commonly used to get Cas9 proteins are Staphylococcus aureus and Streptococcus pyogenes. Both of these bacteria have infected humans for a long time. 

The problem does need to be kept in perspective, though. It remains to be seen if the antibodies interfere with CRISPR-Cas9 in editing genes. And even if they do, there are ways to work around the problem. For example, Cas9 could be developed in bacteria that hasn't infected humans, so antibodies wouldn't be present. Cas9 could also possibly be modified in a way that gives it time to work before the body's immune system attacks it. And, as mentioned earlier, there are other enzymes that could be used for CRISPR gene editing.   

Top stocks for investing in CRISPR

Investors have several alternatives for investing in CRISPR. Editas Medicine (NASDAQ:EDIT), CRISPR Therapeutics (NASDAQ:CRSP), and Intellia Therapeutics (NASDAQ:NTLA) are three biotechs developing treatments based on CRISPR. 

Stock 

Market Cap

Initial Public Offering (IPO) Date 

Key Partners

Editas Medicine

$1.5 billion Feb. 3, 2016

Allergan, Celgene

CRISPR Therapeutics

$2 billion Oct. 19, 2016

Vertex 

Intellia Therapeutics

$867 million May 6, 2016

Regeneron, Novartis

Data sources: Google Finance, Crunchbase, Company SEC filings. 

Editas Medicine

Editas Medicine uses both CRISPR-Cas9 and CRISPR-Cpf1. The company's most advanced program is EDIT-101, which is designed to edit the CEP290 gene in human retinal tissue to treat Leber Congenital Amaurosis type 10, a genetic eye disease that leads to blindness in children. Editas plans to submit an investigational new drug application (IND) by mid-2018 requesting approval to advance EDIT-101 into a phase 1 clinical trial.

Editas has two partnerships with larger companies. Allergan has the option to license EDIT-101 and up to four other gene-editing therapies for genetic eye diseases. Juno Therapeutics, which was acquired by Celgene earlier this year, is in a collaboration with Editas to develop engineered T cell medicines for cancer. 

CRISPR Therapeutics

CRISPR Therapeutics' lead candidate, CTX001, uses CRISPR-Cas9 gene editing to target sickle cell disease and beta-thalassemia, a blood disorder that lowers production of hemoglobin. The company plans to begin phase 1 clinical studies for CTX001 in 2018.  

Vertex Pharmaceuticals is partnering with CRISPR Therapeutics to co-develop and potentially co-market CTX001. Vertex also has an option to license another of the company's gene-editing programs that targets cystic fibrosis.

Intellia Therapeutics

Intellia Therapeutics is farthest along in development with its CRISPR-based treatment for transthyretin amyloidosis (ATTR), a rare genetic disease that causes a buildup of a protein called amyloid in the body's organs and tissues. The biotech's ATTR program is currently in late-stage preclinical studies.

Regeneron Pharmaceuticals is co-developing the ATTR candidate with Intellia. Novartis is also partnering with the small biotech on two programs to use CRISPR-Cas9 gene editing in chimeric antigen receptor T (CAR-T) cell therapies and in hematopoietic stem cells (HSCs), the stem cells from which all types of blood cells originate.

CRISPR patent battles

The three major CRISPR-focused biotechs have engaged in patent battles, with Editas on one side and CRISPR Therapeutics and Intellia on the other. Editas owns the license to a group of patents for CRISPR-Cas9 and CRISPR-Cpf1 from the Broad Institute and Harvard College. CRISPR Therapeutics and Intellia licensed patents from the University of California.

Which side has the better position? It could depend on which side of the Atlantic you're on. The Broad Institute won a big victory in the U.S. last year when the U.S. Patent and Trademark Office ruled that its patents for use in eukaryotic cells (cells that have a nucleus, including all human cells) were valid. 

However, the Broad Institute lost in a patent case earlier in 2018 in Europe. The European Patent Office revoked one of the organization's key CRISPR patents. 

Appeals are in progress both in the U.S. and in Europe. The CRISPR patent battles are likely to continue to rage for a while.

The future for CRISPR gene editing

The most exciting possibility for CRISPR is in curing genetic diseases. Most research underway currently is focused on diseases caused by single gene mutations. As scientists unravel more complicated diseases that stem from multiple gene mutations, CRISPR could be used to address those diseases as well.

There are also other promising uses of CRISPR. The DNA of crops like wheat and rice could be edited to improve resistance to disease and increase yields. Mosquitoes could have their genes modified so that they don't carry disease. CRISPR gene editing could be used to eliminate viruses in pigs that are harmful to humans, resulting in pig organs that are safer for use in transplanting to humans.

Remember that CRISPR is still a relatively new technology. There's a long way to go before any genetic disease is cured through gene editing, much less a world where there are no genetic diseases. Another approach could also be discovered that renders CRISPR obsolete.

And serious ethical dilemmas could arise. CRISPR expert Jennifer Doudna has warned about the potential to use gene editing to create "designer babies" with physical perfection. Such prospects could eventually be technically possible with CRISPR, but they open up a Pandora's box of challenges.

Despite the issues that might lie ahead, CRISPR appears to be the best option right now for achieving that dream of curing genetic diseases. Editas, CRISPR Therapeutics, and Intellia are leading the charge. I suspect that all three of these biotechs could be tremendously successful over the long run. And I think that CRISPR is a technology that will not only change the world, but make some investors wealthy in the process.

Keith Speights owns shares of Celgene and Editas Medicine. The Motley Fool owns shares of and recommends Celgene. The Motley Fool recommends Editas Medicine and Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.