Wouldn't it be great to be able to modify DNA sequences to fix genetic mutations that cause serious diseases? Two companies attempting to do just that are Editas Medicine (NASDAQ:EDIT) and CRISPR Therapeutics (NASDAQ:CRSP). Both biotechs focus on the use of CRISPR gene editing to target rare genetic diseases and cancer.
Both Editas and CRISPR Therapeutics are also solid winners so far this year. But which biotech stock is the better pick for long-term investors? Here's how Editas and CRISPR Therapeutics stack up against each other.
The case for Editas Medicine
Editas Medicine has high hopes for its lead candidate, EDIT-101, in treating Leber congenital amaurosis type 10 (LCA10). A phase 1/2 study of EDIT-101 should begin in mid-2019. Editas Chief Scientific Officer Charlie Albright noted in the company's Q4 conference call that EDIT-101 "is poised to be the first in vivo [in the body] CRISPR medicine administered to patients anywhere in the world."
The company's preclinical studies of EDIT-101 in mice and non-human primates were highly encouraging. These studies demonstrated a rapid onset of editing of the CEP290 gene. Editas thinks that its phase 1/2 study will spur growth of the outer segments in the photoreceptors in patients' eyes, which could restore vision for these patients.
EDIT-101 holds enough promise that it attracted the attention -- and an investment -- from Allergan. Last year, Allergan exercised its option to commercialize EDIT-101 globally in treating LCA10. The big drugmaker also has options to license up to four other gene-editing programs being developed by Editas.
Editas believes that the approach used with EDIT-101 in treating LCA10 lends itself well to treating other genetic eye diseases as well. The next program that the biotech hopes to advance to clinical studies is a gene-editing treatment for Usher syndrome type 2A (USH2A), which, like LCA10, affects photoreceptors in the eyes. Editas thinks that its progress with EDIT-101 should speed up the development process for its USH2A therapy.
The biotech is also pursuing the use of CRISPR gene editing in treating other diseases. Editas is especially optimistic about its approach to treating rare genetic blood diseases beta-thalassemia and sickle cell disease. It's also working with Celgene in using CRISPR gene editing in engineering T cells to fight cancer.
Another differentiator for Editas is its intellectual-property portfolio. The company has exclusive rights to use technology owned by Broad Institute, Harvard, and MIT, on targets of its choosing. Editas Medicine's intellectual property includes over 70 issued patents and more than 600 pending applications for patents.
The case for CRISPR Therapeutics
CRISPR Therapeutics' lead candidate, CTX001, is currently in two phase 1/2 clinical studies. One of those studies targets the treatment of beta-thalassemia, while the other targets the treatment of sickle cell disease. Both diseases are caused by mutations in the same gene, the HBB gene.
Like Editas, CRISPR Therapeutics has a big partner for its lead program. Vertex Pharmaceuticals first teamed up with CRISPR Therapeutics in 2015. CRISPR Therapeutics and Vertex will jointly develop CTX001 and share in any profits equally should the drug win regulatory approval. Vertex also has exclusive rights to license up to five other CRISPR/Cas9-based treatments that emerge from the two companies' partnership.
CRISPR Therapeutics shouldn't be too far away from moving its second candidate into an early stage clinical study. CTX110 is an allogeneic chimeric antigen receptor T-cell (CAR-T) therapy. Current CAR-T therapies are costly and time-consuming because they require genetic engineering of a patient's own T-cells. Allogeneic CAR-T therapies, sometimes referred to as "off-the-shelf" therapies, use engineered T-cells from other healthy donors.
The biotech also teamed up with another major drugmaker, Bayer, in 2016 to launch a joint venture. This joint venture, named Casebia Therapeutics, focuses on developing CRISPR gene editing therapies to treat blood disorders, blindness, and heart disease.
CRISPR Therapeutics' pipeline includes several programs that are being researched but not at a point yet for considering advancing to clinical studies. These include gene-editing therapies targeting rare genetic diseases cystic fibrosis, Duchenne muscular dystrophy, glycogen storage disease type Ia, and Hurler syndrome.
I like the long-term prospects for both of these biotech stocks. In my view, though, Editas Medicine is the better pick for a couple of key reasons. I like the strength of Editas' intellectual property portfolio. I also think that Editas could have a smoother pathway to success than CRISPR Therapeutics because bluebird bio seems very likely to reach the market first with its gene therapy for treating beta-thalassemia.
While I like Editas, however, it's important to keep in mind the significant risks that the company faces. Editas' lead candidate is only in early stage clinical testing. Few experimental drugs at the stage go on to win approval. There's also a possibility that safer and more effective approaches than CRISPR could emerge. I think that Editas Medicine will be a big winner over the long run, but it's a stock that only aggressive investors should consider buying.