Hot off a provocative new set of clinical trial results, Intellia Therapeutics (NTLA -3.36%) and Editas Medicine (EDIT -3.85%) are surging. In the early-stage trial, Intellia's groundbreaking gene-editing therapy performed even better than expected, and it didn't seem to have a burdensome side-effect profile, either. So Editas, which is pursuing similar interventions, looks all the more promising.

What's more, Cathie Wood, of ARK Investment Management fame, holds both stocks. Such institutional backing is likely to expand even more. Though Intellia still has a long road ahead before its drug will be ready for regulatory review, it's off to a running start, and there's still plenty of time to invest.

Two scientists wearing face masks and hairnets work side by side while standing in a laboratory.

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Intellia's trial could be the start of a gene-editing boom

Intellia's bread and butter is making medicines using the most advanced gene-editing methods in biotech, like CRISPR. Though it isn't anywhere near having a product on the market, its new trial results are a strongly positive sign for its future, and for that of nearly all other therapies designed to use CRISPR-based gene editing in living patients.

The treatment in question, NTLA-2001, is the company's phase 1 candidate for transthyretin amyloidosis, a rare and hereditary disease that's eventually fatal. By design, NTLA-2001 inactivates patients' copies of the malfunctioning gene associated with transthyretin amyloidosis, ideally permanently curing them of the disease.

The most important finding from the ongoing trial so far is that the six patients to get the therapy experienced few side effects. That's a game-changer for the entire gene-editing segment of biotech, as Intellia's trial is the first clinical proof of the safety of any CRISPR-based therapy intended to edit a patient's genes directly. The trial isn't over yet, but the preliminary results look quite favorable.

Aside from being safe, the therapy appears to be effective at reducing the prevalence of the protein whose accumulation in the liver is associated with transthyretin amyloidosis, potentially by as much as 87%. It's unclear whether NTLA-2001 will be the only therapy that patients need in order to be symptom-free, but that's a question which should be answered in later-stage clinical trials. If new data show it can be a standalone therapy, Intellia's shareholders will likely benefit even more than they already have.

Finally, to make the most from of its time in the spotlight, the company issued a new public offering July 2, raising $690 million and causing its stock to rise even further on the positive sentiment. It's now up 527% in the past 12 months, and there's potentially far more upside to come as the drug advances through efficacy testing.

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Gene-editing stocks just got a shot in the arm

Though it didn't have any good news of its own to report, rival Editas' stock popped when Intellia gave its trial update; Editas is up just over 42% over the past year and about 25% in the just the past month. That's because Editas is also developing medicines based on directly editing patients' genes using CRISPR. So now that Intellia has shown some preliminary evidence that such medicines are feasible, safe, and highly effective, investors are understandably more bullish about other companies in the same space.

Of course, there's no guarantee that competitors targeting different diseases will have the same success as Intellia. But there's something to be said for having a proof of concept for CRISPR-based therapies, which was sorely lacking until now.

Editas' EDIT-101 therapy for Leber congenital amaurosis, a hereditary blindness disorder, works similarly to Intellia's NTLA-2001. The treatment aims to remove the mutation in the gene that encodes malfunctioning proteins leading to blindness. With the mutation removed, the hope is that many patients will be able to see for the first time.

But safety data needs to be established first, and Editas isn't done with the preliminary stages of calibrating a safe dose. The company will provide an update on how its trial is going before the end of the year, which could catalyze massive growth just like Intellia's if the results are favorable.

For both Editas and Intellia, the journey is just beginning. It'll be years before either business is earning revenue from these promising projects. Until then, there's quite a lot of upside for investors to take advantage of -- but be aware that both stocks are still riding high on the hype from the most recent good news.