What happened
Shares of Editas Medicine (EDIT +2.64%) were up 21.1% for the week as of Friday morning, according to data provided by S&P Global Market Intelligence. The gene-editing biotech has actually had a two-week run. Its shares have climbed 48.7% since January 19, the day it announced it was selling EDIT-202, a gene-editing therapy to fight solid tumors, to Shoreline Biosciences for an undisclosed amount.
So what
Investors clearly are in favor of the company's moves to strengthen its cash position and long-term prospects. On January 9, management said the company was cutting 20% of its workforce and streamlining its operations to focus on EDIT-301. In the wake of that announcement and the sale of EDIT-202, retail investors have increased their positions in the company.
NASDAQ: EDIT
Key Data Points
The science that Editas Medicine uses has shown tremendous potential. The company uses the CRISPR-associated protein (Cas9) to change a person's own cells at the DNA level to fight a variety of diseases. The company's lead candidate, EDIT-301, is a therapy designed to correct genetic errors in genomes to cure two rare, inherited blood diseases: transfusion-dependent beta thalassemia (TBT) and sickle cell disease (SCD).
Two competitors, CRISPR Therapeutics (CRSP +4.60%) and Vertex Pharmaceuticals (VRTX +1.13%), have teamed up on a CRISPR-editing cell therapy, Exa-cel, for the same indications and say they are expected to complete a rolling biologics license application (BLA) with the Food and Drug Administration (FDA) for Exa-cel this quarter. This isn't necessarily seen as bad news for Editas, because an approval for a CRISPR-editing therapy would be an affirmation of Editas' own technology.
Now what
The clinical-stage biotech has a long way to go before it has a marketed product, and its pipeline is limited. However, long-term investors see so much potential in gene editing that they are willing to look past the company's lack of potential therapies and revenue (only $42,000 in the third quarter) at this point. The move to free up cash allows Editas a longer time in which to develop its therapies. At last report, the company said it had enough cash to continue operations through 2025.
